Tag Archives: Mortgage Rates

How to Sell a House!

Still a tough market.

Words of wisdom:  Listen to your Realtor.  If he or she isn’t talking – get a new one.

Getting your home sold requires effort.  If you have your home on the market and there are no showings – there could be a number of things wrong. Price, condition (people see the photos online), poor marketing (poor photos), bad location or all of the above.

To get your home sold now for TOP DOLLAR, your home has to have “WOW” factor.  No “wow” factor and you’re just a plain Jane!

Granite, travertine, stainless appliances, iron stair railings, pendant lighting, paint that “pops”, exciting decor all sell homes.  Have one but not the other?  Probably not enough WoW to be considered.  How about your furniture?  Not up to par?  Then get new or vacate.  You’re not selling your furniture but neither are the new home builders.   They’ve got furniture and they didn’t put in the old stuff.

It costs to sell a home.  It may cost you even more if you don’t get everything done.  Reduce the price by $10,000 after 90 or 120 days?  Why not spend that up front and get the home sold NOW!

I can Help you!  We can get estimates for everything. We can install.  You’ll be on your way to selling your home in no time!  Improving your odds to sell is the smartest and best way to outsmart the competition.

Short Sale Guidelines are Making a Difference

 The theory behind short sales seems simple enough: If a homeowner owes more money on a house than the house can sell for, and the homeowner is struggling to pay the mortgage, the lender will allow the house to be sold for less than is owed. For obvious reasons, lenders are not big fans of short sales and often make it a complicated process. In April 2010, The Home Affordable Alternatives Program (HAFA) released new guidelines designed to streamline the short-sale process and allow more delinquent homeowners to sell their homes and move on with their lives. In its first year, participating servicers initiated 12,266 HAFA agreements and completed 5,447 transactions. According to the National Association of Realtors, the share of distressed homes—bank-owned properties and pre-foreclosure short sales— in April 2011 dropped to 37% of total sales volume, down from 40% in March and an average of 39% over the first quarter. HAFA complements the Home Affordable Modification Program (HAMP), a loan modification program designed to reduce delinquent and at-risk borrowers’ monthly mortgage payments by providing alternatives for borrowers who don’t qualify for or don’t complete a trial modification. “[HAFA short-sale guidelines] are designed to help people who are unable to keep their home under the HAMP loan modification program,” said Jeff Lischer, managing director for regulatory policy for The National Association of Realtors. “Let’s say you can’t keep your property under HAMP, the next step is a short sale, which is better than a foreclosure.” It’s estimated that lenders lose about 40% of a property’s value on a foreclosure, whereas the figure is reduced to about 19% on a short sale. Moreover, the short sale is a graceful exit from the ownership, which is better for people’s credit scores. New rules also add incentives for the short-sale process. One incentive helps sellers relocate by providing them with $3,000 for moving expenses. A second incentive is for mortgage servicers, who receive $1,500 from the federal government for each completed short sale. Under new guidelines, homeowners can secure a short sale approval in advance from the bank representing a minimum net amount the bank will accept. Lenders participating in the HAFA program maintain the following requirements for homeowners considering short sale: The loan must be less than $729,750, made before Jan. 1, 2009, and the home must be the owner’s primary residence. Also, the homeowner must be delinquent and unable to pay the mortgage, and the homeowner’s mortgage payment must be more than 31% of his or her before-tax income.

Call Norman Frenk at 713.818.0829 today to get more information on short selling your home.

Updating your Home to SELL!!!

There are so many things that you can do to update your home – where do you start?  What gives you the best bang for your buck?   Do I need a designer or permits?  Start inside or outside?

Lots of good questions.   Here are your best answers:

The first rule of thumb:

Use the 10% rule: Ensure that your home is not too terribly different from the rest of the homes in the neighborhood.   If hardly anyone else in your neighborhood has new cabinets and granite, then adding that won’t give you as much of a return. Don’t add that 3rd garage bay if less than 10% of the homes in the neighborhood have one.  Reason?  The other homes in the neighborhood have a direct impact on the value of your home.

Therefore, if everyone else in the neighborhood is updated, do not expect to get as much for your home, but the overall value of your home may be increased by the higher values around you.

Rule of thumb #2:

Do not overdo one area such that you won’t have money for the other areas.  Your kitchen is fabulous with new granite, sink, paints, appliances and lighting but the rest of the house is still stuck in the 80’s.  Not a good recipe.  Instead, go more moderate in several rooms.

Start with Kitchens and Baths, first repairing any deficiencies.  Turn that 1.5 bath into a 2 full bath before you go for all new tile or updated items.  Start with easiest items after that:  Removal of old wallpaper and fresh paint in neutral colors go a long way. Remove and replace outdated tile colors, old sinks and appliances.

Selling Your Home in a Down Market…

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Let’s face it – it’s been a tough real estate world out there.  Foreclosures are high, Short Sales are up, values are down.   The incentive programs by the Obama Administration helped temporarily, but mostly the homes in the lower price ranges.

Market Situation:   Homes are sitting on the market longer, competition is fierce, buyers are more scarce.  So what can You do to ensure the sale of your home?  Follow these rules – get your home sold.   Think that your home is so special – you get to keep it (hey, if it’s that special, maybe you really don’t want to sell….)


1)  Your home has to be PERFECT.  That means perfectly clean, perfect yard maintenance, perfect paint job, perfect smelling, perfectly staged.

2) No, you Don’t live there. “But we have to live here too”….  No you don’t.   Move out if you have to.  If you cannot live neatly, if your pets, little league, scrap booking, hobbies etc. take up your life then take off $10,000 to $20,000 from the price to ensure your sale, otherwise make the appropriate changes in your lifestyle to ensure that your home looks like a model home.

3) The value of your neighbor’s home does NOT translate into the value of yours. (especially if they sold for a great price).    Does your home have granite, travertine, wood flooring, new carpet, new roof, new a/c like other homes in the neighborhood?  Is yours professionally decorated like theirs?  Don’t expect the sales price of your home that may not be updated to be anywhere near the other homes that have been updated.   Their final sales price will help you in the appraisal process, but not in the sales process.

4) Price your home to SELL at the onset.  If everyone else is marketing their home for $250,000, then undercut them immediately and sell yours (all other things being equal) for $225,000.   Pricing yours at $249,900 will not do anything to bring the buyers to yours instead of the other homes.  Then they will start dropping theirs to $239,900 then you’ll drop yours to $238,000 then someone drops theirs to $230,000 and you’ll finally drop yours to $225,000 hoping that they don’t drop it also.  This may be a several month process where you may miss the selling season and may ultimately sell your home for the same amount or even less months later.  You may have missed purchasing the home of your dreams because you couldn’t act fast enough.  Not to mention the months of keeping your home perfect for showings.

5) Hire the right Realtor – and then Listen to him/her! Is selling real estate your business?  Are you not paying your Realtor (at closing)?  Then why not take advantage of his/her years of marketing and marketing knowledge?  How do you know you are hiring the right Realtor?   Many publications and on-line sources give you questions to ask.  So generic.   How long have you been selling homes in my area?  blah, blah, blah.   The number one reason a seller hires a particular Realtor is price.   A seller is always impressed with a high price – not marketing, not length of service.  Then the home sits on the market.   Instead, a homeowner should take the approach that a Realtor that knows the market and is honest enough to give a real evaluation of the home is the man/woman for them.  Experience is key.  A seasoned Realtor will know the other homes in the neighborhood. They will know what and where the competition is and how your home stacks up.  They will know how to stage your home to compete.  The Realtor’s purpose is to SELL your home – not to list it and have it sit on the market.

Norman Frenk, author of SellThisPlaceNow.com blog has been in the Houston metro real estate market for 18 years. Norman holds an M.B.A. and is accredited with an I.R.E.S. designation (International Real Estate Specialist).  He works with Prudential Gary Greene Realtors and is consistently To producer and the Top Listing agent in the office

New Job Report – How it affects Homes, Mortgages & You

New Job Report – a Mixed Bag of Treats ( or Tricks)

The Labor Department, today, released the latest government data for Non-farm payrolls ( employment data ) which revealed jobs losses of 20,000 for January. This was a surprise as the consensus expected a gain of 15,000 – 20,000 jobs. Surprisingly, the unemployment rate dipped to 9.7%. However, employment numbers for December were revised to 150,000 job losses as compared to initial reportings of 85,000. Furthermore the Business Survey threw in another revision that indicated an ADDITIONAL 900,000 job losses from March 2008 – March 2009 from what was previously report.

Oh well, so what are we to believe when every time we turn on the TV we hear nothing but rhetoric, propaganda, politicking, etc. However, all in all the job market does appear to be “improving”…at least there is definite signs of reduction in the number of job losses each month. But the fact remains is that the labor market remains weak. So what does this mean for the mortgage market and interest rates?

Mortgage Rates:

Mortgage rates continue to be favorable and in most cases, dipped back below 5%. Most likely contributing factor to this has been the string of losses with the stock market since the January 19th. Since reaching a peak of 10725 ( DOW index ), stocks have fallen to under 10,000 for the first time since November 2009. Aside from the employment situation there is a lot of unknown weighing on investors, and as is generally the case, the stock market is adverse to the unknown. With continued uncertainty and Capital Hill floundering about, stocks may continue to waiver which could be a boon for bond prices and interest rates.


RestrictedArea Well, we all heard it – The Shot Heard ‘Round Clear Lake’ – Obama’s budget that pulled the rug      out from under NASA and the Constellation Project. I am sure that this is not the end of it and  the fight may just be beginning. This may not be good news for the greater Houston area and especially the Clear Lake/Bay Area, but keep in mind this is a fight that has been going on each and every year – should we fund more NASA projects or take the money for something else.   The average has always been that NASA stays around and is healthy.  That’s not to mean we don’t have  work ahead of us. Each of us can do our part by continuing the fight – contact our Congressmen and Senators, the louder we are, the better we’ll be heard.

Market Predictions:

This is a tough one now…so many variables. On the bright side, I think it is a safe bet that mortgage rates will continue to be favorable throughout the first quarter of the year. The downside is that buyers may be more skiddish, even with the home buyer Tax Credit extended through April 30, 2009. Nevertheless, we continue to remain optimistic as market conditions remain optimal for home buyers.

More Changes?

Not yet! I am sure that everyone is aware of the GFE (Good Faith Estimate) and HUD changes. So far the transition has not been quite as difficult as I expected. It does, however, add quite a bit more time and detail of explanation to our clients to be sure that they have an understanding of the new processes.

FHA announced increase in the upfront Mortgage Insurance Premium from 1.75% to 2.25% effective for new FHA case numbers on or after April 5, 2010. In reality this will make very little difference to the buyers costs or payments. But, there are other changes that will have more of an impact in the very near future, including but not limited to a reduction in allowable seller contributions from 6% down to 3%.

Mixed News as Bonds and Mortgage Rates Flip Flop

Jobs Report indicates improvement


Last Friday’s Jobs Report indicated surprising results.  Instead of 125,000 job losses that were expected, the Labor Department reported only 11,000 jobs lost in November.  And if that were not enough, the Unemployment Rate improved to 10% – down from 10.2%.  It was also reported that the previous two months were revised to 159,000 fewer job losses than previously reported…strange, how the initial reports can be so skewed.

Stocks were up sharply on the news, but have recently fallen back from comments from Fed Chairman Ben Bernanke.  The Fed Chief commented that inflation will remain low, interest rates will stay low and the economic recovery faces “formidable headwinds”.  After the speech, stocks traded lower as investors sought safe haven of bonds.  Over the past few weeks, bonds had drifted lower, pressuring mortgage rates higher.  However, last few days, bonds have leveled out and mortgage rates remain in good shape.

We can expect these trends to continue into the new year.  It is widely expected that mortgage rates will remain favorable for some time to come.  There will be times of hills and valleys, but the overall outlook for mortgage rates is favorable for the short term.  But, as always, there are many variables that could have sudden impact and change the course of direction:  Should stocks begin to rally or any sign of inflation arise, interest rates will have negative consequences.  Possibly year end profit takers could precipitate a fall in the stock market which would benefit bonds and interest rates.


Reminder:  Fannie Mae changes


Don’t forget about new changes with lending requirements.  Starting  Dec 14th, any new applicants from now on that will not be closing shortly will be held to a maximum 45% debt to income ratio.  Some buyers that were previously preapproved with debt ratios over 45%, will now be ineligible and previous approval withdrawn.