Saturday, September 29, 2007

Home Sales Decline - What will happen next?

If you didn't get a chance to take a look at the business section of the la times on Wednesday the 26th of September the article "Home Sales Take Sharp Tumble" gives several reasons why the housing numbers are down and what is happening nationally and locally.


So let's get the good news out there so it doesn't look like all bad news. Despite the fact that the median home price is down in most areas of the country Los Angeles County had a 2.6% increase in the median home value. That's right, despite everything that is going on the median value of homes in Los Angeles County rose. So why is that? Well Los Angeles County continues to have job growth and the Southern California climate and job market tend to be desirable places to be. This is good if you are in Los Angeles County. Let's be clear though that there are some areas of the county that are seeing pricing pressure and it doesn't mean that sellers can ask 2.6% more for their home than their neighbor got last year. It does mean that homes are still selling though. In fact homes continue to sell nation wide.


So the bad news. The amount of inventory of unsold homes continues to grow. The inventory amount is called months of inventory and means how long it would take to sell all the existing homes on the market if no new homes came on. Currently according to the article there is 11.8 months nation wide. At 12 months or more of inventory it is considered a buyers market. This means that at least there is favor to buyers being able to negotiate better terms for themselves. Now this is a nationwide number. In Long Beach there are areas of the city that have 12 months of inventory such as downtown long beach and there are areas of the city such as Belmont Shore that have less than 8 months so it depends on what area you are looking in.
Now the article points out that most groups predict it will more than likely continue to get worse before it gets better. So what does that mean if you are thinking of selling. I believe it means you should consider selling your home sooner rather than later or at least know that when you do sell you may be competing against more properties on the market and there may be pricing pressure on your home as well as it may take longer to sell.
So if you are a buyer should you wait? Well that is where you have to look at where the interest rates are now and where they are likely to be next year. More than likely next year the rates will be up from where they are today. That means even if prices adjust down you will be paying more per month for the same home. Homes or condos with loans at or under $417,000 in southern California can be purchased with conforming loans and will not be affected to a great degree. Right now as a buyer you have the ability to get a great interest rate near a 40 year low as well as nice property. Check out the post on "Getting the Price You Want" to see how you can start negotiating now.
So all of this means that the market will continue to adjust but there is still a great opportunity out there for first time home buyers and sellers who need to move up.

Friday, September 28, 2007

Short Sale Purchases come at a Price

The deals on properties are out there, and now that short sales are becoming a consistent part of the Long Beach real estate market, we thought it would be helpful to provide some insight on what to expect when purchasing a short sale or a quick sale*.

Purchasing a short sale or a quick sale can present some challenges. Since a short sale is not a foreclosure there can be some challenges that are a bit different than your traditional Long Beach home or condo purchase.

  1. Time Frame - Understand that even with the best Long Beach realtors invovled, completing a short sale will take substantially longer than a traditional escrow period. Time periods to complete a short sale can often take 90+ days.
  2. Understanding Bank Approval - The bank that holds the first and second trust deeds on the property (and they can be different banks) must "approve" of the sale. They must take into consideration the purchase price and terms and the penalties (amounts owed by seller) and determine if accepting the offer on hand is better than going to foreclosure. This period can take 3 or more weeks.
  3. Repairs and Credits - Many banks are allowing very few (if any) credits for buyers to purchase properties. This is the case with short sales, but not the case in foreclosures at this time. Be aware that if you are purchasing a short sale you may get a break on the price, but may have to pay most (or all) of your own closing costs. Also remember that most of the time these are "as-is" sales meaning the seller will not make any repairs to the property.
  4. Escrow Updates - Your Long Beach realtor may often not have any information to update you on the status of your offer. Some banks allow the listing agent to check-in regarding the status of the approval, while others do not. It has been our experience, that GMAC, does not let realtors call for updates, while loss mitigation departments at WAMU do allow more frequent checking of the status.

If you want to purchase a short sale it can certainly be an opportunity to pick up a great property at a great price. Realize that you may need to submit a few offers out there on different properties so you can obtain one and just be prepared to pay some closing costs.

*Quick Sale is a term being used by Countrywide that means the same as a short sale

Wednesday, September 26, 2007

6 Loss Mitigation Tips That Really Work

Loss Mitigation is a word that is being used in record numbers these days. Often times no one even defines what is loss mitigation and how does it help everyone in regards to real estate and home sales.

Loss Mitigation is generally a department within a bank or a servicing company that strives to help home owners who are in danger of losing their homes. Their job is to reduce the amount of money that the bank is going to loose, hence the name of their department. Now let's be clear these people are not always appreciated and are often not thanked for the job they do. They are trying to help homeowners who are in trouble navigate the banking system. Each bank or servicing company is different.

We thought it would be great to give you a few helpful tips when you are dealing with loss mitigation. These tips work whether you are calling yourself or your real estate professional is calling.

  1. Smile on the phone when you speak with them - this may sound crazy but it gives your voice a nice tone. They have many files that they are dealing with and many people aren't nice to them. The nicer you are the easier it will be.
  2. Ask for their name or employee number - it is always good to keep track of who you speak to in case of further need arrives that you need to get back to them or reference them.
  3. Ask what the best way to communicate with their department is - some prefer fax, some e-mail, others mail, and still others need you to call. It is best to work within the system they have. The easier you make it for them the easier it will be for you.
  4. Ask when you can expect a response - It is great to see when they can get an answer for you so you know what is going on.
  5. Don't get angry - it is not their fault that they cannot do something. They have rules they have to follow as well. Be patient and work within the system. Explain your situation and ask them what kind of options you have with them. Sometimes you may have to ask several different ways so be patient.
  6. If you feel they did a great job ask to speak to their supervisor to compliment them - they often only get people complaining and while it may not directly help your situation they are people too and passing on a compliment goes a long way to making sure they help you to their fullest extent.

We hope that these work out well for you. We have found them to work out tremendously well for us and for our clients when working with Loss Mitigation departments. If you have a tip we haven't listed we would love to hear your thoughts.

Tuesday, September 25, 2007

What is Escrow and Why do I need it?

As an escrow officer, I'm asked questions like "What is escrow?" and "Why do I even need an escrow anyway?". The following are three answers to commonly asked questions:

Escrow - What is it?
Very simply defined, an escrow is a deposit of funds, a deed, or other instrument by one party for the delivery to another party upon completion of a particular condition or event. The California Escrow Law - Section 17003 of the Financial Code - provides the legal definition.

Why do I need Escrow?
Whether you are the buyer, seller, lender, or borrower, you want the assurance that no funds or property will change hands until ALL of the instructions in the transaction have been followed. The escrow holder has the obligation to safeguard the funds and/or documents while they are in the possession of the escrow holder, and to disburse funds and/or convey title only when all provisions of the escrow have been complied with.

Escrow - How does it work?
The principals to the escrow - buyer, seller, lender, borrower - cause escrow instructions, most usually in writing, to be created, signed and delivered to the escrow officer. If a broker is involved, he or she will normally provide the escrow officer with the information necessary for the preparation of your escrow instructions and documents.

The escrow officer will process the escrow, in accordance with the instructions, and when all conditions required in the escrow can be met or achieved, the escrow will be "closed". Each escrow, although following a similar pattern, will be different in some respects, as it deals with YOUR property and the transaction at hand.

The duties of an escrow holder include: following the instructions given by the principals and parties to the transaction in a timely manner, handling the funds and/or documents in accordance with instructions, paying all bills as authorized, responding to authorized requests from the principals, closing the escrow only when all terms and conditions have been met, distributing the funds in accordance with instructions and provide an accounting for same - the Closing or Settlement Statement.

Anchor Seaport Escrow
Jami Harris, Escrow Officer
(562) 434-4437

3 Tips to Get the Property You want for the Price You want!

As some buyers are in the wait and see mode, we thought it would be helpful to give a couple of tips to get the deal that you want on the property you want. As interest rates are at historically low levels this is a rare occurence where there are proeprties to choose from and good rates to borrow money.

So...if you see the property you want but are hesitant because you feel the prices might drop here are 3 tips to get the price that is right for you.

  1. Write the offer for the price you want! - That's right if you feel there is going to be a drop, write below the asking price so that you feel comfortable with what you are offering. Keep in mind you won't be picking up Long Beach condos or homes for 50 cents on the dollar but you may be able to get 7-10% off of the list price depending on how competitively priced it is.
  2. Be Prepared - Ensure that you include your FICO scores, proof of funds, copy of check, and pre-approval with your offer. Whether you are offering on a REO (foreclosure), short sale) or a traditional seller this will help you get a strong discount.
  3. Understand the Market - Review the listings provided by your local Long Beach realtor or use the FREE Long Beach MLS to see what is out there so you can recognize a good deal from a great deal! If a property comes up that is rarely available in an area (maybe like a condo in Alamitos Beach with parking) and it is priced under what the other ones usually go for, don't wait! Go and get the deal you want by putting out an offer. By reviewing the listings on the MLS system you will know what is a good deal and will not have to wait for someone to tell you it is a good deal.
Try these tips so you can get the property you want in the area you want! Have fun shopping as it is a rare time to have such great choices available.

Monday, September 24, 2007

4 Ways to Prevent Foreclosure Now

Right now foreclosure, the thought of foreclosure, or information pertaining to how to buy foreclosure properties is everywhere. We thought we would tell you a great way to avoid foreclosure starting with things you can do today if you feel you might be near that point where you might start missing mortgage payments.

  1. Know what kind of home loan you have - I don't like saying that you shouldn't trust what people say but you definitely should know exactly what your mortgage is on your home or condo. Do not take for face value what the person who did your loan said make sure you have read all the paperwork and understand it. Even if it was a really good friend it may be an unintentional mistake that was made so understand what kind of loan you have. If you are missing copies of your loan paperwork then call your lender and get copies of it.
  2. Create a budget & stick to it! - many times foreclosure happens because people do not understand where all of their money is going. Know where you spend all of your money and stick to a savings plan.
  3. Save every month - We all know it is hard to do in this day and age but we also all enjoy Starbucks and itunes so save a little every month in case you loose overtime or a job so you can cover your mortgage payment while you are looking for new work.
  4. Refinance your loan if you don't have a fixed rate - The federal reserve dropped the rate at which banks borrow money last week. They are now lending money cheaper than they were even 3 weeks ago. If you have a loan that is adjusting right now or is about to adjust and you want to stay in your home this is a great time to refinance. Make sure you know all the fees and know what is going to happen with your loan. Even if you don't plan on staying in your home for more than the next couple of years you may want to keep your property and rent it plus getting a long term loan right now is cheaper than a short term one.

We hope these 4 Ways to Prevent Foreclosure help people keep their home. Make sure to pass on this list and help those who are having trouble.

Long Beach Triathlon is a Success!


For all of those athletes and those who came to watch the Long Beach Triathlon was a great success. There were athletes of all agents and all levels of competition. Over 800 athletes finished this great event that had people arriving at 5:30 am on Sunday to get their gear ready.

We will have some pictures up shortly of Alamitos Beach at this time in the morning and beautiful shoreline drive which passes west of all of those beautiful condo towers on ocean blvd.

If you missed the results you can find them at http://www.onlinereaceresults.com/ or for the exact link go to http://www.onlineraceresults.com/event/view_event.php?event_id=2181.

Saturday, September 22, 2007

Don't Miss the Long Beach Triathlon

OK we posted a reminder about this fantastic even a little while back but we wanted to make sure that everyone knows that tomorrow, Sunday, September 23rd 2007 is the Long Beach Triathlon. If you have registered you know that you should be picking up your packets today at the Queen Mary.

Now there may still be room to sign up by going to Pacific Sports LLC. So even if you can't get in this will be a fantastic event starting bright and early at 7:00 am for the very first race. This is a great event that raises money for aids education locally here in Long Beach.

The race will go by the beautiful Queen Mary and through Downtown Long Beach and Alamitos beach. Even if you don't get a chance to participate check out the event as there will be over 1,300 athletes of all levels competing. James and I will be there competing as well.

What is a Pre Foreclosure?

These days there are many different words being used to describe properties that are in distress. You hear everything from short sale, to pre forelcosure, to quick sale, to well you name it. Today I thought I would cover what is a short sale and what is happening so everyone has a better idea. This will not be the last post on pre floclosure properties. We have really just begun to see what is going to happen.

Let's start at the beginning.

  1. Defaulting on your mortgage - now to be clear almost all home loans state that you are in default if you are 1 day past when the payment is due. So are all of us in default when we pay late? Well the bank doesn't want to go through the kind of paperwork to say you are in default. In general most banks penalize you if you are past 15 days late on your payment with a late fee.
  2. 30,60,90 day notices - this is when you haven't paid your mortgage for 30 days after it has been due. For example if your mortgage was due on August 1st of 2007 and you hadn't paid it by September 1st you will more than likely receive a 30 day notice on your credit and from your bank in the mail. Trust me they will be calling you and sending you letters as well.
  3. It is homes that are past the 30 days that have a potential to be pre foreclosure homes. Now let's get this straight everyone has problems now and then so some people can bring their homes current (pay all past due fees) and some have experienced problems that they cannot and will not be able to bring them current.

So pre-foreclosure means a home owner is at least past the 30 day mark and maybe even after the 90 day late notice point. They have received notices but their home has not been sold to the bank, taken to sale, or sold to an investor. Home owners who are in this situation can consider a short sale. Check out the post earlier in the month on "Avoid Foreclosure - Ask for a Short Sale" for more information on that process.

So we hope that this clears up what a pre-foreclosure is. Feel free to share with your friends. This is a changing market and many home owners need help right now so make sure they know all of their options.

Thursday, September 20, 2007

Fed Rate Cut has little effect on Long Beach Condos

As everyone eyes the Long Beach real estate market in the "wait and see" mode, the rate cut should help with consumer confidence. The rate cut did help the stock market to soar, but it's effects may be little felt here locally, but that may not be a bad thing.

For those interested in purchasing property for the first time the pricing on interest rates continues to be good with little effect from actions by the Federal reserve. Many Long Beach Condos and homes can use buyer programs like CalHFA, ACORN (Bank of America), and FHA loans to acquire their properties for less. These programs have been around for quite some time but require the lender to do a bit more work and they are limited to what they can make. These programs really thrive in markets where buyers have the leverage.

Contact your local direct lender at Bank of America or Wells Fargo to learn more about how these programs can help. If you want to see what properties might meet the guidelines, use the Long Beach MLS and search away so you can see the opportunity!

Monday, September 17, 2007

Should we get a Home Warranty?

A home warranty is very beneficial to have especially during the listing and sale of a property. A home warranty will protect the major systems and appliances that are listed in our brochure for the new homeowner for the length of a year and it is renewable yearly. You can also get coverage for the length of the listing and escrow period when your house is on the market.

Each company covers different items so you will want to review the home warranty that you receive. After you have reviewed several companies, like those of Old Republic Home Warranty, First American, and others, ask your agent which one they have the best relationship with.

In our brochure we outline the different items we cover as well as our limits and exclusions so there are no surprises. We also list all of the different options you have the ability to purchase as we know not all homes have for example air conditioning or pools and spas! You can check out our brochure on our website at http://www.orhp.com/. You can also get a quote online and once you have a plan on your home you can even place service requests online with a click of a button!

At Old Republic Home Protection we are focused on GREAT service and taking excellent care of our clients! You also have two Account Exectuives here to work with you and your agent to make sure you get the best plan and best service around!

Mortgage Crisis? - Real Numbers on Delinquencies

The LA Times this past weekend actually prepared a balanced article allowing people to come to their own conclusions. In their article "And now for good mortgage statistics" by Kenneth R. Harney they cover the aspects of foreclosures and the amount of mortgages that that are delinquent. Here are some of the highlights:

  • "Mortgage crisis" is very particular to local markets. A state like Ohio has 5.2% of all home loans that are 3 months past due while other states are dramatically lower.
  • The nationwide average for prime-credit borrowers being delinquent on fixed-rate loans is over 2% while in California it is barely over 1%.
  • The Sub prime effect though does have bigger implications. 12.6% of sub prime borrowers in California are now late on their payments. This can be a small number compared with West Virginia (26% late) or Mississippi (almost 27%) late.
  • So for the record number of Foreclosures? Kenneth Harney states "In 34 states, the rate of new foreclosures actually decreased."
  • California did see an uptick in Foreclosure filings although those were attributed to investors walking away from their properties.

Kenneth does a great job of pointing out that the foreclosures (REO's) will be concentrated in specific areas at a local level. For those wishing they can get the Home in Belmont Shore or Naples for 20 cents on the dollar it doesn't look likely.

Sunday, September 16, 2007

New Construction for LBCC

If you have driven by Clark Ave and Carson st you have seen the construction going on at Long Beach Community College (LBCC). The campus has been undergoing extensive construction extending this the southern portion of the complex. The new structures will be adding additional capacity for a few different elements of the school. The large cement structure, nearby the South of Conant neighborhood, will be helping the Aviation Maintenance and Automotive Facility. The structure that you can see with wood timbers, along Carson St, will be adding classrooms for technology and administrative offices.



As it is the 80th year of celebration the college is really continuing to innovate as it supports the cities of Long Beach, Lakewood, and Avalon!

Saturday, September 15, 2007

Walk for Life Helps Everyone

If you didn't know the Avon Breast Cancer Foundation is having their annual walk that starts in Long Beach this weekend now you know! This is a great cause and everyone was already walking early this morning. It is a great group of people who are raising money for breast cancer.

So if you are down near the queen mary or you are near downtown long beach this weekend you might want to take a moment to cheer them on. They are covering 39 miles so they will be they will walk through Belmont Heights and Belmont Shore so please cheer this great walkers on!

If you want more information on this great event please check out Avon Walk.

Friday, September 14, 2007

Belmont Shore Real Estate Sales for August 2007

If you live near the water in Long Beach you may live in the communities of Belmont Shore, Naples, or Belmont Heights. These communities feature homes and condos of all shapes and sizes. But that isn't what this post is about. This post is all about the numbers and what has been happening in those areas. So let's take a look at sals figures for August!

All stats were taken from the SoCalMLS system which covers the Long Beach area. If a property was sold without going through the MLS it will not be reflected in these figures.

August 2007 for Belmont Heights, Belmont Shore, & Naples

  1. New Listings - 59
  2. Total Active Listings at the end of the Month of August - 212
  3. In Escrow Properties - 15 (9 Pending, 6 Backup)
  4. Closed Sales - 10

So what does this all mean? Well it means that things are still selling near the water. In fact buyers have some great choices. Now if you think you will be getting an ocean front home for $200,000 I am sorry to dissappoint but sellers have shown flexibility with buyers who want to buy their homes and aren't just fishing for an offer.

Thursday, September 13, 2007

FHA Loans Provide New Hope in Long Beach

FHA loans were once ignored due to the many loan options available from conventional lenders. With pricing pressure throughout the city and stricter guidelines from conventional products, FHA loans are popular again!

FHA guidelines provide substantial credit flexibility and other benefits to borrowers.
Congress created the Federal Housing Administration in 1934. At this time, nearly two million construction workers were laid off. Only four out of ten people owned their own home. In addition, mortgage loan terms were outrageous. Borrowers had to put 50 percent down, and the note ballooned in 3 to 5 years. So the mission of the FHA was to encourage home ownership.

The FHA became a part of HUD, which is the Department of Housing and Urban Development, in the year 1965. In the mid-1980's, the FHA transitioned to what we call direct endorsement and began approving lenders to underwrite and close their own loans. Prior to this time, the FHA did have a hand in the process of the loan.

Unlike, Conventional loans, FHA loans are not score driven. Instead, they are written in a way that provides the borrower the benefit of the doubt that there had been, at some point in their past, circumstances beyond their control, and as long as the borrower has recovered from those circumstances in a reasonable manner, they're generally going to be credit-eligible for an FHA loan. The FHA guidelines are forgiving about circumstances that many other lending programs, including conventional, are not favorable towards.

An FHA-insured loan allows a wide variety of assets to be used to cover the buyer's down payment and closing costs. FHA guidelines require a 3% minimum investment from the borrower; however, those funds can be from a gift or from a variety of other sources. The FHA considers gift funds to be the same as if they were the borrower's own funds truly seasoned for sixty days in the borrower's account, or proven to be from other eligible sources. You also have the option of using down-payment assistance charity programs like The Nehemiah® or AmeriDream® down payment assistance programs. Use of charity fund programs allow the buyer to receive a gift for the down-payment immediately prior to closing, and then the amount of the gift plus a small service fee is collected from the seller immediately after closing. This is a legal way of funneling money from the seller to the buyer that is acceptable to HUD. There are also numerous City, State and Federal down payment assistance programs available to offset the 3%.

FHA guidelines also allow fund sources such as mattress money, or lease option credits used, as they are lenient about how the borrowers can procure the down payment money. As an added bonus, the FHA is very liberal about what they will let the seller pay in the way of the buyer's closing costs and pre-paid items. The seller can pay up to 6% in concessions towards the buyer's closing costs, pre-paids and discount points.

A distinct advantage of an FHA insured loan, as compared to a conforming loan, is great interest rates and lower monthly mortgage insurance (MI). In most cases, standard FHA loan interest rates are usually better than a conforming 30-Year Fixed loan. Also, the mortgage insurance premium on any FHA loan is only .05% per year.

Another advantage of an FHA loan program is the variety of properties that can be used. While FHA Guidelines do require that the property be Owner Occupied (OO), they do allow you to purchase condos, planned unit developments, manufactured homes, and 1–4 family residences, in which the borrower intends to occupy one part of the multi-unit residence.

Article provide by Christal Dunn of Bank of America

Don't sign over your Deed to your home!

During the changing times of real estate at the moment there are a variety of people who come out of the wood work in order not help but take advantage of home owners when they are behind on their payments. I thought it would be good to go over a few tricks that these people use and some of their pitches so home owners that are considering a short sale or are facing foreclosure can be aware of.

Now these individuals or companies come with a variety of pitches to make it sound like you are a winner on the deal and that you will avoid foreclosure or not have to go through a short sale if you just sign the deed over to them. Below are some of the best pitches that I have heard and please we caution people not to listen to these people and contact a real estate professional or a lawyer prior to signing anything that releases your rights to your property.

  1. "Sign your deed over to me so I can negotiate with the bank and you won't have to worry about anything" - once you sign over the deed you no longer control what happens with your property. You are still on the hook for the loan you just can't do anything with your home.
  2. "The deed won't be worth anything if you go to foreclosure it is just a piece of paper." - It is a piece of paper that says you own the home and the bank has lent you money based on that home. Once you sign it over the person can even evict you from your own home.
  3. "Sign it over to me and I will let you pay half the amount you are paying now so you can stay in your home." - You have literally no guarantee that they will do this. They have no obligation and can say whatever they want. If someone states this ask them to put the funds for the next 6 months in an escrow account with an escrow company you choose and have a contract written up to state where the money will be sent. If the don't like this they probably aren't telling the truth.

Please remember that if someone makes you an offer that sounds to good to be true it probably is. The best thing you can do if you are facing foreclosure or want to consider a short sale is contact a real estate professional or a lawyer in regards to these issues.

Wednesday, September 12, 2007

Avoid Foreclosure - Ask for a Short Sale

There are many home owners at the moment that are facing foreclosure of their homes. The entire process of foreclosure and missing payments on it can be terrifying, embarrassing, and stressful. In order to make prevent a foreclosure the best possible thing that a home owner can do is ask the bank to work with them on a short sale. A short sale occurs when you owe more than the market value of the property and the property cannot be sold with the bank being paid off in full.

Banks such as Bank of America, Countrywide, and Washington Mutual have Loss Mitigation departments set-up in order to help home owners in this market. They are people too and they want to help their borrowers in their situation. The first step is to speak with the bank and ask for Loss Mitigation department. You want to see if they can help you lower the payments first if you want to keep your home. Banks can lower the interest rate if you are behind in payments and your credit and job worthiness indicate that this is only temporary. The only way to get this is to make sure you speak with the bank.

The vast majority of banks these days have short sale packets that you can ask for. These packets will ask you to outline in detail what you owe not only on your home but also all your assets.

Credit Unions Aren't the Only Option Left

The Los Angeles Business journal wrote an article on their September 10th issue about "Credit Unions Step In As Big Lenders Falter". Now this artcile by Howard Fine makes a good point that there have been certain lenders who have struggled recently such as Countrywide and IndyMac. Both of these lenders that he mentions borrow money to lend on although IndyMac to a less extent. Why is this important? Well in order for Countrywide to lend money to a consumer they must first find someone to get it from. So they borrow at a cheaper rate because they borrow so much money at one time and then lend to the consumer at a higher rate. That isn't the point of this post though.

The article highlights the top 10 credit unions in the area with number 1 being Kinecta. Now don't get me wrong I have an account at a great credit union in the area as well and I even got my first car loan from them. The article fails to mention even slightly a few great banks that aren't faltering these days. Two of them are Washington Mutual and Bank of America. Now we have said in the past these are two great banks that continue to help out customers of all levels. What is really important to know is that if you are a first time home buyer there are still great first time home buyer options available. The state of california and government backed loan products that are offered by both WAMU and Bank of America are great and will beat any offer from the credit unions for first time home buyers. So if you are going to be buying your first home or condo soon make sure that you get a second opinion from one of the banks that takes deposits all across the country.

Tuesday, September 11, 2007

New Long Beach Projects and Environmental Impacts - See what's going on!

With many new projects still planned in throughout the city of Long Beach it helps to know what where they will be and what impacts they may have.

The Downtown Long Beach Business Associates website does a wonderful job of keeping information up to date on upcoming projects, including maps of where the projects are to take place and estimated dates of completion.

The City of Long Beach posts regularly to their website about the environmental impacts that different developments will have. Now that the Press-Telegram mixed use development is moving along (if you have driven by you will notice a large banner is now up :)) you can check out their Environmental Impact Report as it is up for public review.

We are always happy to share other resources that are out there. If you have a favorite website you use to keep track of the different happenings throughout Long Beach, please post a comment and share with the rest of us.

Monday, September 10, 2007

4 Tips on How to Purchase a Short Sale

Short Sales or Quick Sales are a part of the Long Beach, Ca Real Estate market. A short sale occurs when the property is trying to be sold for less than the trust deed that the bank has on the property.

Purchasing a short sale is different than purchasing an REO (Foreclosure). Here are 4 tips on how to have a successful purchase of a short sale:

  1. Be Patient! - The bank has to approve the short sale. Unlike an REO where the bank already owns the property, in a short sale the bank has to decide if they are comfortable losing a certain sum of money. The bank must determine if it would be cheaper to go to foreclosure than accept the offer. For this reason, it can take many weeks (sometimes 6 weeks or more) just to get an approval of the short sale. The total process of purchase can take 3 months.
  2. Deposit Amount - You will need to have a deposit that is at least 1% of the purchase price of the property. The bank wants to see that you can complete the purchase.
  3. Complete Package - Have as much documentation as possible. In other words, include FICO scores, bank statements, and a pre-approval letter to show you are prepared.
  4. Closing Costs - You can still get closing costs from the bank, but you will be limited at 3%. Be prepared that the bank may come back and knock that amount down as they are reviewing your offer.

As you are working with your Long Beach realtor, realize that they may be hesitant to submit an offer on a short sale because often the realtor commission gets cut. Be persistent and be open that you may need to look for other properties in case your short sale does not get approved.

Friday, September 07, 2007

August Sales for Long Beach - The Cold Hard Facts

Ok August came and went and the last days of summer are just about behind us. All those who are going to school are just about in their classes. So where does that leave the Long Beach real estate market? Well let's see the numbers for August to see what happened.

As usual all sales data is taken from the realtor MLS system that serves the Long Beach area. So let's take a look and see what happened in August.

Long Beach Statistics for August 2007

  • Sold - 210
  • Expired - 153
  • In Escrow - 161 (Pending - 102, Backup 59)
  • New Listings - 591
  • Total Active as of September 1st - 2,167
  • Total Active as of Today - 2,227 - (60 new listings so far this month)

Ok so what does this all mean. Well it means we have a 10.8 months supply of inventory. The number of sales that are occuring in Long Beach continue to decrease. This means as a seller one will have to be more and more competitive.

For the buyers there are choices out there but not as many as you would think. In some areas there are not many properties. In areas of Alamitos Beach there are less than 3 condos that are under $300,000 that have parking associated with them. So while there are properties available it depends on the requirements that you have and the amount of money you are willing to spend. Make sure you take a look at what you absolutely have to have and go from there with your real estate professional.

Thursday, September 06, 2007

Are there really many Long Beach Homes and Condos available?

It's a question we get asked daily and if you listen to the media there seem to be many choices on every block, but it may not necessarily be the case.

As buyers are looking through the Long Beach MLS, there may be 100's of properties available in any given area, but very few that are garnering their attention.

In fact if you look for specific requirements, then you may not find many properties to look at so you may really have to "jump" on that home or condo you have been wanting. Here are a few examples of the limited inventory.

  • Alamitos Beach - If you are looking for a 1 bedroom, 1 bathroom condo, that HAS parking and under $300,000. - Condos Available: 1
  • California Heights - If you are looking for at least a 2 bedroom, 1 bathroom Craftsman or Bungalow, and under $650,000 - Homes Available: 1
  • Belmont Shore and Naples - If you are looking for 2 bedroom, 2 bathroom condo up to $550,000 - Condos Available: 3 (Finally some options!)

If you want to find a Long Beach home or condo that you will enjoy for the long haul, you will want to take the time to be specific. Ensure that you take some time speaking with a Long Beach realtor that understands your goals and can help you to learn about what is possible. Monitoring the inventory you will be able to see if you have many choices, or just a few!

Wednesday, September 05, 2007

The Interim Binder

Q. What is the Purpose of the Interim Binder?

A. It allows a purchaser of real property to re-sell the same property and have a new policy of title insurance at a fraction of the cost.

Q. What is the Cost of the Interim Binder?

A. This is the formula: The original seller pays the basic policy fee. The buyer pays an additional 10% of the sellers schedule insurance rate for the Interim Binder.

Q. Can a Trust hold title to Real Property?

A. No; the Trustee holds the property on behalf of the Trust.

Here is an Example: The original owner sells a property for $ 100,000. You, knowing that this is going to be a short term investment for the buyer, request an INTERIM BINDER before the close of escrow. The original owner (seller) pays a title policy fee of $660, the normal charge.

Benefits of the Interim Binder

The buyer, pays $66 or 10% of the basic rate for the INTERIM BINDER. One year and 11 months later, you find a buyer for this property which is now worth $120,000. The property goes into Escrow. The buyer becomes the seller. Now the seller can reap the benefits of the INTERIM BINDER which was purchased when the seller bought the property.

Using the Interim Binder Saves Money

The seller pays only the increase insurance amount necessary to cover the increased price of the property.
The money saving advantage of using the Interim Binder is evident. Title Fee on $120,000 liability $723.00 Less premium paid on $100,000 $660.00 Sellers cost for the new policy $63.00.

Q. How Long is it Good For?

A. Two Years.

Q. What Happens if I Keep the Property Longer than 2 Years?

A. In that case a policy of title insurance is automatically issued to you.

However, the binder may be extended for another two years at an additional 10 percent.

It All Adds Up, For Less

The total cost for an owner’s policy of title insurance is $63 plus the 10% or $66 the seller paid up front when the seller bought the property. The policy is a total of $129 compared to $591, the normal short term rate fee for a home valued at $120,000. The seller saved $462.

The Truth Behind Credit Scoring and Credit Repair

Understanding Credit Scoring & Credit Repair

Credit remediation is a subject consumers often face with fear and trepidation, and for good reason. With the exception of recognizing that the best score wins, the average home shopper knows very little about the whole credit scoring process. Sub-prime borrowers who are eager to move into A-Paper territory often find themselves at a loss when trying to find ways to upgrade their credit history. The good news is there are ways to improve less-than-perfect credit scores and obtain a loan for the home you really want.

The first step in the process is making sure that you have a current copy of your credit report. Congress recently amended the Fair Credit Reporting Act so that consumers may now receive one free credit report annually. There are three major credit bureaus: Equifax, Experian, and Transunion. Since entries can vary across bureaus, you’ll want to request a free report from each of the three companies. (Go to http://www.annualcreditreport.com/)

It's also important to know just what a good credit score is. Most A-Paper scores generally begin around 680, although this number may differ slightly among lenders. Don't despair if you come up shy, there is always room for improvement. Increasing your score just 5 points can save a significant amount of money. For example, if your score is 698 and you increase it to 703, then you could save yourself thousands of dollars over time as a result of a slight improvement to your loan’s interest rate.

While credit repair is necessary for some, it's not the only way to increase your credit score. Even if you have stellar credit, you can enhance your score through these steps:

  • Evenly distribute your credit card debt to change the ratio of debt to available credit. Let's say you have a credit score of 665. If you have debt on only one card, and four additional credit cards with zero balances, evenly distributing the debt of the first card could move you closer, and possibly into, that ideal bracket.


  • Keep your existing accounts open and active. The average consumer is usually anxious to close credit card accounts that have zero balances, but doing this can cause them to lose the benefits of a long-term credit history and increase their ratio of debt-to-available credit. The bottom line is don't close those old accounts!

  • Keep credit inquiries to a minimum. Each inquiry into your credit history can impact your score anywhere from 2-50 points. When it comes to mortgage and auto loans, even though you're only looking for one loan, multiple lenders may request your credit report. To compensate for this, the score counts multiple auto or mortgage inquiries in any 14-day period as just one inquiry, so try and stay within that time frame.
Remember, credit scores don't change overnight. Improving them requires time and diligent effort on your part, so it's a good idea to get the ball rolling at least three to six months prior to submitting your application for home financing.

If credit repair is what you need, you can either begin the process yourself or seek out a repair service. If you decide to make your own improvements, visit as many websites as possible to get information regarding credit laws and consumer rights. Diligently search through them and educate yourself to ensure that you don’t sustain any self-inflicted wounds. A good place to start would be the Federal Trade Commission's website, which contains a wealth of helpful literature.

If you’re facing severe or complicated credit issues, then you’ll probably want to enlist the assistance of a professional credit repair company. Before you do, be sure to familiarize yourself with the FTC's regulations on credit repair. With over 1100 credit repair companies to choose from, it's important to be certain you are dealing with a reputable firm. Examine the FTC's information on fraudulent practices to avoid falling prey to credit repair scams.

Addressing credit issues can be uncomfortable to say the least. But by taking these steps now, you’ll be that much closer to obtaining the home of your dreams.

Additional Resources:

To order your free credit report, go to:
http://www.annualcreditreport.com/

To read the Fair Credit Reporting Act, go to:
www.ftc.gov/os/statutes/frca.htm

For the Federal Trade Commission's information on consumer credit, go to:
www.ftc.gov/bcp/conline/edcams/credit/index.html

Contribution of this post was done by Christal Dunn of Bank of America

Tuesday, September 04, 2007

Don't Fear Your Lender - Government Urges Them to Help

Times are changing and the federal government has given some guidance to lenders to urge them to help borrowers out. So how does this affect all of us in the Long Beach Real Estate Market? Well it will help our home owners who are in trouble and nearing real estate foreclosure. When the federal government talks banks, lenders, brokers, and everyone tends to listen.

Detailed information can be found at Fed Urges Companies to help borrowers. So why would lenders voluntarily comply with recommendations from the government? Well because it is better to comply when you are asked nicely to then when you are told to with a mandate. Again how does this help home owners who are trying to avoid foreclosure in Long Beach? The guidance given to lenders covers options that will help owners in Long Beach and all over the country. Those options are as follows:

  1. Loan Modification - This is where the lender modifies your existing loan to help you afford it. This may include fixing your adjustable rate rate mortgage to a fixed rate.
  2. Deferring Payments - Allowing you to defer payments on your loan for a short amount of time to help you get back on your feet.
  3. Extending the loan - stretching out the term of the loan so that it lowers your monthly payment.

Rest assured when the government makes recommendations to lenders they will listen. So if you are having problems right now with making your loan payments call your lender and ask to speak to the loss mitigation department or someone who can help you. Sometimes it just takes getting to the right people.

Saturday, September 01, 2007

Fun in Belmont Shore at Annual Car Show

The 18th annual Belmont Shore Car show will be held on Sunday, September 9th. The already popular 2nd St, gets even more popular this day as many classic cars line the streets for everyone to view. It is estimated that it will display about 650 classic automobiles. You will be able to see some wonderful classic cars as all cars must have a model date prior to 1975.

These kind of activities bring people from all over Long Beach and other cities so they can experience some of what Belmont Shore has to offer. Belmont Shore offers some large homes just blocks from the beach as well as a few Long Beach condo complexes where you can enjoy the cool Ocean Breeze. The island of Naples is right next door to Belmont Shore providing many wonderful homes that can have canal access or powerful Ocean Views.

If you are interested in getting your car into the show, it is pretty affordable at $25 for pre-registration or $30 at teh show. Visit the car club's website at http://www.baycityrodders.com/

Avoid Foreclosure - Government to Help Home Owners

President Bush announced earlier this week that the government would step in and help some home owners to refinance their loans. They want to do this through FHA or the Federal Housing Authority. So how many people are affected by the potential adjusting loans? The government estimates that over 2 million home owners are near or facing foreclosure. So how does this help home owners in Long Beach California? Well first of all let's look at who, what, and how many are likely to get help.

  1. The government estimates that about 80,000 will be affected by this new change. That is a very small amount in comparison to what is outstanding in the market currently.
  2. They are going to help home owners refinance. Now they are helping those who currently can't get refinanced. This will mean your loan amount must be conforming or under $417,000 so home owners in long beach california may not get much help out of this program.
  3. The government will not be bailing lenders out or home owners out with cash or any type of subsidy at the moment.
  4. The biggest part of this plan is that President Bush is trying to get the IRS to not tax home owners on the debt relief. Currently if you are working to avoid foreclosure through a short sale or in foreclosure the lender can and probably will issue you a 1099 for the amount that they lost on the sale of the property. This means you will owe taxes on that amount. In some cases that number can be astronomical. This would allow people to work more closely with the lenders and with less fear.

If you want to avoid foreclosure today make sure that you call your lender and ask for a short sale packet or that you ask to speak to the loss mitigation department.

Don't Miss the Long Beach Blues Festival

If you don't live near or in the Los Altos area of Long Beach then you might have missed the fact that this weekend is the Long Beach Blues Festival. Students who are ready to go back to school at CSULB have an up close view of a wonderful event.

The campus is the center piece for this event that will be taking place all Labor Day weekend. In fact KJazz 88.1 FM has a schedule on their website so you can check out what is going on all weekend.

After you leave the festival take a look at the surrounding area homes of Los Altos or College Park Estates which are close by.

Enjoy the Labor Day weekend and let us know what you thought of the Long Beach Blues Festival.