Realty Times - Home Prices on the Rise While Mortgage Rates Remain Low

Realty Times - Home Prices on the Rise While Mortgage Rates Remain Low

The Trouble with Vacant Homes

By Ruben Gonzalez Jr.

Prudential California Realty (DBA)

Today’s housing market makes it tougher to get the price for a home and, often, sellers can’t wait around while their homes are on the market. They may have a new job in a different location, may have already bought their next house or need to move to their new location so the kids can start at their new schools.

If sellers already have a new home, it’s likely that they’ll take all their furniture and leave the property empty during selling process. The U.S. Census Bureau’s most current data shows that more than 2.2 million for-sale houses in the U.S. were vacant in 2008, and that number has risen over the last few years as more homes fell into foreclosure or short-sale status.

Yet it all comes down to perception for buyers, who understand that vacant homes can suffer from a wide variety of ills due to neglect and deferred maintenance. Moreover, vacant houses pose unique challenges for showcasing and selling because many buyers cannot see beyond an empty home. They’re looking to buy a “home,” as opposed to a “house,” and without furniture, wall art, rugs, lighting and décor, there are few emotional connections.

Plus, with no furnishing to focus on, a potential buyer will be on the lookout for imperfections, such as floor scratches, nail pops, chipped grout and other imperfections.

The easiest fix for a vacant home is to bring in a home stager, who can give the property a comfortable, lived-in look, enabling potential buyers to better visualize how they would use the home.

When a home buyer perceives flaws and can’t see a home’s potential, there will be fewer offers, greater price reductions, more days on the market, higher carrying costs and less profit.  

A vacant home can also hurt your negotiating power. If buyers know that you are already out and most likely paying another mortgage, they will figure you are more motivated to sell and will likely present a low-ball offer.

By staging a vacant home, you will create a proper vision for the property and achieve a quicker and hopefully more profitable outcome.

Ruben Gonzalez can be reached at (562) 507-0754 or E-mail. Prudential (dba) is an independently owned and operated broker member of BRER Affiliates, Inc. Prudential, the Prudential logo and the Rock symbol are registered service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide. Used under license with no other affiliation with Prudential. Equal Housing Opportunity.

VA Loans Are Opening Homeownership Doors for More Veterans

By Ruben Gonzalez Jr.
Prudential California Realty(DBA)

Past and current military personnel looking for financing in today’s more stringent mortgage environment can take advantage of the VA loan program, which has been available for more than six decades to help members of the military own their own homes.

The program, established in 1944 as part of the Servicemen’s Readjustment Act, is available for any individual who has served in active duty in any branch of the U.S. military for a minimum of 90 days.

“The beauty of this loan is that it allows financing without requiring a down payment,” said Eric Kandell, founder of lowvarates.com. “It also doesn’t allow the mortgage lender to charge the veteran private mortgage insurance.”

A VA loan does require the borrower to pay a one-time funding fee on their purchase, which can be paid up front or financed into the total cost of the loan. The funding fee for regular military members is 2.15% of the loan. Reservists pay a fee of 2.40%.

Non-active duty personnel, such as individuals in the Army Reserves or National Guard, may apply for a VA-backed mortgage provided they have completed six years of service. Spouses of deceased or missing military members are also eligible if they have not remarried. Those who were dishonorably discharged from any military branch are not eligible.

“I’ve closed more VA loans in the past two years than in the past decade,” said Steve Thorne, area manager for First Financial Services, Inc. in Raleigh, N.C. “It really is a great benefit to the veteran in the ‘New Mortgage World.’ The key to getting more veterans to take advantage of this benefit is simply an awareness of the benefit.”

Statistics provided by the Department of Veteran’s Affairs show that roughly 25 million people are eligible for a VA loan yet only 10-15 percent of those have taken advantage of it when buying or refinancing.

One reason is that for many years leading up to the mortgage crisis, there were many conventional mortgage products that were easier or more economical to the veteran than the VA loan.

“In the wild, wild west of mortgage lending from the early 2000s to 2008, 100% financing was common,” Thorne said. “So why pay the VA funding fee just to have 100 percent financing? Not to mention the VA control of the appraisal process, understanding residual income and all the additional disclosures. It was just a more cumbersome process then the ‘come on down, everybody gets a loan’ of the conventional arena.”

Many veterans, especially those not so recently discharged, aren’t sure of VA loan benefits or that the program even exists. With the VA loan the veteran can buy a home with little to no money out of pocket.

“In the past, veterans were told about other financing on the market and people were more inclined out of ignorance to use non-VA loan financing,” Kandell said. “[The VA loan] is a great loan and you are going to see a massive shift in numbers going forward.”

Talk to a mortgage representative for more on VA financing.



Ruben Gonzalez can be reached at (562) 507-0754 or E-mail. Prudential (dba) is an independently owned and operated member of BRER Affiliates Inc. Used under license with no other affiliation with Prudential. Equal Housing Opportunity.

Realty Times - Sellers Getting Comfortable With Today's Housing Prices?

Realty Times - Sellers Getting Comfortable With Today's Housing Prices?

Consumers Are Returning to the Real Estate Market with an Age-old Question: Buy or Sell First?

By: Ruben Gonzalez Jr.

Prudential California Realty(DBA)

Residential real estate is gaining stability in concert with the recovering U.S. economy. Consumers, drawn by one of the most attractive buyers’ markets on record marked by historically low interest rates and lower home prices in many areas, are returning to the market to move up, trade down, improve location and otherwise enhance their share of the American Dream.

When it comes to home buying, the ideal situation would be to find a new home, just as you receive an offer on your existing home. You would then be able to close concurrently and move into your new home a few days prior to closing on your previous home. This does happen more often than not, but anyone looking to buy a new home needs to consider all the possible scenarios.

Should you buy or sell first? There are many schools of thought on this subject. Ultimately, it depends on you and your situation. For instance, can you afford to pay two mortgages in the event your previous home does not sell by the time you move? Would you consider a bridge loan (a short-term, high interest loan that let you borrow against the value of your old home to covers the bills until you secure the new, larger loan)? Are you willing to move twice to find the home of your dreams if you sell first and can't find the dream home fast enough?

This is where the advice of a real estate sales professional is invaluable. Real estate sales professionals know the current market conditions. They are trained and experienced in working with home buyers and sellers to determine an ideal time to buy and sell.

It is generally less stressful to sell your home first, because you won't have to worry about owning two homes at one time. The market will dictate how long it will take your home to sell, as will your location and the time of year. As a rule of thumb, it is a good idea to put your home of the market as far in advance as possible when purchasing a new one. But, since interest rates are low and confidence is returning to the market, there’s a good change your home will sell faster if priced properly. (Again, your real estate professional’s advice is critically important here.) In that case, you may want to purchase a new home first.

What if your present home sells before you find a new one, putting pressure on you to find the right house for you more quickly? You may then decide to make an interim move or request to rent back your home for a specified amount of time as you continue to look for your new home. Those may be worthwhile options if you have your heart set on a specific location or type of home or if you are purchasing a home that is under construction.

If you buy a home before selling your present home, you may end up with two mortgages. Under those circumstances, you may be able to apply for a bridge loan to assist you in making two mortgage payments until you sell your first home. Your real estate sales professional can assist you in finding a lender.

So should you buy or sell first? This is a challenging question regardless of real estate cycles, yet your own circumstances and a knowledgeable real estate professional will help you make the right decision.

Ruben Gonzalez Jr. can be reached at (562) 507-0754 or E-mail. Prudential (dba) is an independently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential Financial company. Equal Housing Opportunity. 

Realty Times - Opportunity Knocking for Mortgage Refinance One Last Time: Or Miss the Chance of a Lifetime

Realty Times - Opportunity Knocking for Mortgage Refinance One Last Time: Or Miss the Chance of a Lifetime

Improve Your Credit Score

By Ruben Gonzalez Jr.

Prudential California Realty (DBA)

Those about to start house hunting should check their credit score before things get too serious. There is nothing quite as frightening in the mortgage process as learning that your credit report contains a late payment or other blemishes that can prevent you from buying a property.

The higher your credit score, the better your chances are of financing a home. A credit score of at least 620 will give consumers a fighting chance to secure a home loan; 720 should qualify in most cases.

However, a lower credit score doesn’t necessarily mean you can’t finance a home. Credit score repair begins with your credit report. You can request a free copy of your credit report annually from the Federal Trade Commission at AnnualCreditReport.com. Check the report for errors.

Don’t panic if your report contains blemishes. There are steps you can take to fix negative marks, regardless of whether the marks are in error or if you’ve missed a payment or two. The simplest thing to do if you’ve missed a payment is to call the creditor and ask them to erase the negative listing. You can also do this with a well-documented letter. There is no guarantee that a lender will do this, but if you’ve been a good customer through the years, this method has proven to be successful.

If you are one of the many who have defaulted on a student loan you can enter into a “rehab program,” which will get your account back on track after 12 months. This may not be the quick fix you need when buying a home but the sooner you do this the better.

For disputing a negative mark that was not your fault, you can try disputing the account with the credit bureaus as “not mine.”

One quick fix used by borrowers to boost their credit score is to have an older family member with a sound credit rating add you as an authorized user on a credit card. This can help increase your score and you wouldn’t even need the card in your possession.

With more loans requiring higher credit scores today, it’s never too early to start fixing credit challenges.

Contact me TODAY and let's find out together where you stand. Remember information is POWER!!!

Ruben Gonzalez can be reached at (507) 507-0754 or E-mail. Prudential (dba) is an independently owned and operated broker member of BRER Affiliates Inc. Prudential, the Prudential logo and the Rock symbol are registered service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide. Used under license with no other affiliation with Prudential. Equal Housing Opportunity.

Realty Times - 30-year Fixed-rate Mortgage Moves Up, Averages 3.55 Percent

Realty Times - 30-year Fixed-rate Mortgage Moves Up, Averages 3.55 Percent

Realty Times - Short Sale Fraud All Too Common

Realty Times - Short Sale Fraud All Too Common

Make Your Offer Stand Out

By Ruben Gonzalez Jr.

Prudential California Realty (DBA)

Real estate consumers are realizing that there has rarely been a better time to buy a home. In fact, historically low mortgage rates coupled with lower home prices have even sparked bidding competition in markets around the country.

A good home in a solid location may attract ample attention only hours after being listed. Home buyers can make their offers stand out from the rest through one or more of the following strategies:

Price. Obviously, price tends to be the primary consideration for sellers. When you’re competing for a home, to get an edge, think about adding a clause stating that you will beat the highest offer by “x” dollars up to “x” amount. Cash offers can be more attractive to sellers as well. Although sellers will receive their money at closing whether buyers pay with cash or take out a loan, cash offers don’t require lender approval.

Financing. It’s not enough to be pre-qualified. Pre-qualification only tells how much you can afford. Pre-approval goes a step further. Your lender will thoroughly evaluate your application—including verifying employment information and financial disposition—then clear you for a loan of a determined amount. Having your loan pre-approved gives you a sizeable advantage by putting you on equal footing with cash buyers.

Good Faith Deposit. Buyers offering a larger-than-customary amount of “earnest money,” a deposit that accompanies an offer, may get a seller’s attention. By committing more money up front, buyers demonstrate greater sincerity and motivation to close the transaction. Your real estate professional can guide you as to the appropriate sum for your specific transaction.

Contingencies. Consider minimizing contingencies, those clauses that allow buyers to back out of a contract if certain conditions are not met. For example, it’s common for buyers to make the purchase contingent upon their securing satisfactory financing. Obviously, offers with the fewest conditions tend to be more attractive to sellers.

From a contingency standpoint, first-time buyers are often better prospects for a seller’s home than move-up buyers. That’s because first-time buyers’ offers are not contingent upon the sale of a present home. Even if a move-up buyer has an offer in hand, that buyer’s offer may be contingent on another contingency, and so on down the line. If one transaction derails, they all might.

Relationship. Help the seller get to know and identify with you by looking for ways to connect. Find common interests, such as a shared appreciation of gardening. You can then persuade the seller that her prize roses will be well tended. Share brief family stories. The more the seller gets to know and like you, the better chance your offer will stand out in a competitive environment.

Considerations for Short-sale and Foreclosure Transactions – Bank-owned properties represent a significant portion of today’s housing inventory. Competition can be most keen for these homes as their prices can run 10% to 20% below current market value.

Banks conduct extensive research to set these prices and generally base them on current market value less the cost of required repairs. Make your offer based on your own check of comparable sales and other due diligence. Banks won’t get offended by a low offer, yet a realistic offer will more likely keep you in the running.

Remember, patience is essential when buying bank-owned property as the process can take up to six months and longer.

Contact me today in order to begin work on buying your dream home or investment property. My knowledge, skill and expertise will help you make sound real estate decisions today or any other time.

Ruben Gonzalez  can be reached at (562) 507-0754 or E-mail. Prudential (dba) is an independently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential Financial company.