Fixer uppers are properties that are in less than perfect condition. That covers a wide spectrum of possibilities from simply needing carpet and paint to needing a new foundation and roof. But these properties are very popular for a number of reasons. Buyers like the idea of paying less than market value for a home, doing the work themselves and benefiting from an instant equity boost. Homeowners also like the idea of being able to personalize the home to their tastes and desires. Contractors use these homes as flippers to keep their book of business flowing. They buy, repair and instantly resale. At Landmark we keep a current list of fixer upper properties. Contact us if you are interested in seeing the list.
Low inventory is causing Sonoma County home price to rise dramatically. If you are interested in finding out what your home is worth give us a call at (707) 579-9155
Struggling homeowners are beginning to see some new programs rolled out that may help them avoid foreclosure. Foreclosure is the last and worst option for both the homeowner and for all of us in the neighborhood. The homeowner gets forced out of their home, their credit scores are lowered by over 200 points which will leave them in a tough spot getting any kind of loan for the next 5 years. The neighborhood suffers because the homes are often neglected in the lengthy time between the old owners leaving and the new owners completing the purpose. The neighborhood values are negatively impacted as the home will be sold for significantly less than comparable sales that are not distressed. For all of these reasons and more it will benefit the entire neighborhood if a better solution can be found.
HAMP (Home Affordable Modification Program)
This federal program is designed to assist struggling homeowners to stay in their homes by making the loan more affordable. A loan modification can be a reduction in interest rate or a reduction in the loan balance. Eligibility includes:
- Primary residence
- Balance of loan < $729,750
- Struggling to make payments due to changed circumstance i.e. loss of job, increase in payments or large medical bills (loss of equity alone will not qualify)
- Did you get your mortgage before 1/1/2009
- Total housing payment exceeds 31% of gross monthly income (total housing payment includes principal, interest, taxes, insurance, HOA dues, mortgage insurance)
If you meet these qualifications you may be qualified for a loan modification. Your loan servicer must be participating. To see if your loan servicer is participating go to www.MakingHomeAffordable.com/contact_servicer.html
HAFA (Home Affordable Foreclosure Alternatives)
Another federal program rolling out April 5th, 2010 is designed help homeowners avoid foreclosure by securing a successful short sale. Incentives are offered to mortgage servicers to participate. A short sale will have much less impact on a borrowers’ credit scores than a foreclosure. To learn more about short sales click on the’ loan center’ above and select ‘loan modifications’
When discussing options with home sellers, one question that always comes up is- ‘What should I tell the buyers regarding the condition of the property?’ The question stems from a fear that if you were to tell the buyer everything you know about the condition of the house and the surrounding area, they may be turned off to buying it. The answer to the question of ‘what to disclose’ is ‘EVERYTHING’ you can think of to disclose.
Not only is there a legal responsibility to disclose all known facts about the property, but I have never seen disclosures turn off a buyer. It is much more likely that a seller will kill a deal by being dishonest than they will by leveling with the buyers about the property.
As an added benefit when I represent a seller in a transaction I always purchase a Home Warranty insurance plan for my seller and their buyer. This plan helps to protect the seller during the sale period and the buyer for a year after, by covering repairs to insured home systems in the event of a failure during that period. To see what is covered by a typical plan click here.