Selling a home and helping the buyer finance may be a good option to getting a house sold, experts say. Yet it is imperative that the seller thoroughly investigate the buyer's finances before agreeing to the deal.

Here are some important initial steps to take:
 

• Investigate the buyer by asking him to fill out a Uniform Residential Loan Application.
• Get bankruptcy details by checking out the case through Public Assess to Court Electronic Records (PACER), a service of the U.S. Judiciary.
• Pull the buyer's credit report and eviction and criminal history via the American Apartment Owners Association Web site.
• Insist on 20 percent down or offer a contract for deed, which only confers full ownership rights after the home is paid off.
• Consider offering a lease-option with part of the payment going toward the purchase price, which gives the buyer time to repair his credit before seeking conventional financing.

Source: The Wall Street Journal, June Fletcher (08/28/2009)
 

The following article outlines a serious problem for those of you who are current mortgage holders, and who opted to use an option adjustable rate mortgage (option ARM) when purchasing your home.  If you are one of those facing a disasterous increase in your mortgage payment, it may be to your benefit to try to refinance your loan.  If you can qualify for a fixed rate loan to refinance your adjustable ARM, it would be best to do it as soon as possible, while rates are low.

Daily Real Estate News  |  August 28, 2009  | 

Option ARMs, which accounted for $750 billion in mortgages issued between 2004 and 2007, according to Inside Mortgage Finance, are at serious risk with at least 50 percent already in default.

Resets on option ARMS have doubled the payments for many holders.

“Everyone’s been focused on subprime, but we’re more concerned about this,” says Todd Jadlos, managing director of LPS Applied Analytics, which analyzes data for the financial industry. “By the time subprime defaults had increased 200 percent, in June and July of 2007, option ARMs had gone up 400 percent. People just didn’t notice because the overall numbers weren’t as high.”

Lenders have stopped offering option ARMS, but there are about 600,000 held by borrowers, three-quarters of whom are paying interest only. When the cap is reached – for most after they have held the loan for five years – they’ll face drastic increases.

Barclays Capital estimates that banks will lose $112 billion on option ARMs. Some banks are aggressively refinancing these loans, Barclays says.

Source: The New York Times, John Leland (08/26/2009)
 

Here is more evidence that waiting to buy may be a mistake.  For those with the resources to make a real estate investment at this time, whether it be a home, rental property, or REIT, now is the time to move!

Daily Real Estate News  |  August 27, 2009  |  

Investors are returning as the real estate market recovers.

BusinessWeek’s real estate guru Marc Roth points out these opportunities, which he says make sense if investors are willing to look over the property carefully and ask tough questions.

Options they should consider include:
 

• Buying a single-family house. This could be a first home or a dream home or a home to rent out.
• Buying a multi-family investment property.
• Snapping up a vacation property. There are deep discounts to be found in high-end resort areas.
• Investing in a Real Estate Investment Trust. REITs were hit hard in the downturn, but many are on their way back.

Source: BusinessWeek, Marc Roth (08/26/2009)
 

New Home Sales Surge 9.6% in July
New U.S. home sales surged 9.6 percent in July, rising for the fourth straight month
and beating expectations as the housing market shows continuing signs of rebounding from its historic downturn.

The Commerce Department said Wednesday that sales rose to a seasonally adjusted annual rate of 433,000 from an upwardly revised
June rate of 395,000. Sales are now up 32 percent from the bottom in January, but off 69 percent from the frenzied peak four years ago.

Last month's sales pace was the strongest since September and exceeded the forecasts of economists surveyed by Thomson Reuters, who
expected a pace of 390,000 units. The last time sales rose so dramatically was in February 2005.

The median sales price of $210,100, however, was still down 11.5 percent from $237,300 compared to the same time a year ago.
There were 271,000 new homes for sale at the end of July, down more than 3 percent from May. At the current sales
pace, that represents 7.5 months of supply, the lowest since April 2007. The decline means builders have scaled back on construction to the point where supply and demand are coming into balance.

Timeshares are among the most difficult real estate to resell. In this economic climate, buyers are rare and management companies will refuse to take the unit back and even threaten debt collection if an owner fails to pay maintenance and management charges.

Here are some suggestions from Lisa Ann Shrier at TimeShareInsights.com
for getting out from under an unwanted timeshare:
 

• Most property managers won't buy back the unit or even take it off an owners' hands without paying anything, but it's worth asking.
• Avoid sales agencies that charge an upfront fee to sell a timeshare. Chances are these deals are going nowhere.
• Advertise the property widely and expect to get no more than 35 cents on the dollar.
• Look for a charity that will take the property as a donation.
• Consider renting the property.

Source: Tribune Media Services, Ed Perkins (08/24/2009)
 

Just a short note to let you know that I have been on vacation for the past 2 weeks. I took my grandson to Yellowstone, the Black Hills, Mt. Rushmore, Bryce Canyon, and Zion. Had a wonderful time but after driving over 4000 miles in two weeks, I am ready to go back to work. My regular postings to my blog will start again tomorrow.