Taking Advantage of a Buyer's Market

Potential home buyers have been waiting with bated breath for a change in the real estate market.  For many years the nationwide market trend has been a seller's market.  In most markets, that has changed to some extent.  With the construction boom this country has experienced over the past few years there is now an abundance of home inventory in many locations across the U.S.  This has created that "buyer's market" people have been waiting for.  In a buyer's market there are many homes and fewer buyers which makes owners have to be more competitive to attract those buyers.

The question is: "how can you best take advantage of a buyer's market?"

The first step is to get your financials in order so your mortgage approval can be done swiftly.  With the money question answered you can move on to searching for the perfect home.

One thing you may notice about a buyer's market is that homes may tend to be listed for a longer period of time.  This can work in your favor as sellers become more and more anxious the longer a home is on the market.  This is not to say you can simply low ball them and steal a home but you may find they are more open to negotiation than they would be if the buyer's market was not a factor.

In a buyer's market you are in a naturally advantageous position and it can be easy to lose sight of the final goal.  The main idea here is to find a great home that will suit you and your family for years to come or to form a piece of a well-planned investment portfolio.  The idea is not to find the cheapest home or the most desperate sellers.  Try to think in terms of what will fulfill the dynamic and changing needs of your life now and in the future.  A well-planned home purchase can be the most gratifying purchase you'll ever make.  It's all the sweeter if you just happen to get a great deal in the process.

If Your Mortgage Lender Goes Under

More and more mortgage companies are closing shop as the subprime loan saga continues.  Here's what to do if yours shuts down:

1: Regardless of what kind of trouble the mortgage company may be in, you still need to send in your payments on time.  Remember, your payments are considered an asset to the company.  If a lender declares bankruptcy, those assets will just be sold to another lender.

2: The terms of your loan should always stay the same, no matter who holds your loan.  It's important that you thoroughly review the details of your mortgage agreement. The interest rate and the type of loan you get should not change.  If your lender does sell your mortgage, you should receive a letter from the company within 15 days that outlines the new mailing address and payment deadline.  You should also be given a toll-free telephone number that you can call if you have any questions.  You must get a grace period of 60 days to get your payments to the right place on time.  If you have any complaints or issues, write a letter to your lender.  The company is required to respond within two months of getting your letter.

3: If you have paid off your mortgage loan in full, and you want a mortgage satisfaction document from the company when it's no longer in business, go to your State Attorney General's office.  There you can find out the status of the company.  You should be able to find out who you can contact.

4: A servicer - the company you make your monthly check out to - may not think it's worth its while to negotiate with homeowners to lower monthly payments.  No matter who you make your monthly check out to - get on the phone if you're having trouble making payments.  The sooner you bring attention to the problem, the better off you'll be.

Do you have a mortgage now from a lender who has filed bankruptcy?  We'd love to hear your comments below.

Buying a Second Home

In spite of the current state of many real estate markets the time is right for the purchase of a second home.  In a slower market with lower prices and great deals on valuable homes there has never been a better time to get your hands on an investment property.  For many years the second home may have seemed like something that was beyond the reach of the average home buyer.  High prices and a lot of competition for available homes made it somewhat difficult to justify the purchase of additional real estate.  However that has changed as the market has slowed down and home prices have returned to a somewhat more reasonable level.

The purchase of additional real estate has always been a fantastic way to increase your personal worth and monthly income.  Whether you are thinking about additional properties for income or for a quick renovation and flip, there is great money to be made from the purchase of real estate.  Over the years, real estate has continued to be one of the most stable of investments you can invest your money in, as stock markets and such are open to large fluctuations and dips, as we've all seen recently.  Homes, on the other hand, always seem to appreciate in value even in a "down market."  The rate of appreciation may slow down at times, but the appreciation is steady.

Talk to us about owning a second or vacation home.  The time may never be better than it is right now.  Buying a vacation home when markets are hot only means you stand to gain less appreciation in the long run.  When markets soften, that's the time smart investors get off of the sidelines and in to the game.

We welcome your comments and thoughts.  Simply click the comment link below and tell us what you think.

Owner Financing: Will it Return?

If you're ready to buy a home, the recent turmoil on Wall Street may be further hurting your chances of getting a loan.  Investors are reacting to a mortgage industry crisis not seen in decades.

Some lenders are shutting down, laying off thousands of employees and leaving buyers in the lurch. Interest rates and the terms of loan offers are changing daily. And borrowers with tarnished credit are facing deal-killing loan terms — if they can find a loan at all.

It makes one wonder - Will Owner Financing on a home return just to get property sold as was a trend at one time decades ago?

Of course, the only sellers who could even entertain such an idea are those with no mortgage, and we suspect there are fewer and fewer of these types of homeowners around these days.

If you were selling a home and had no mortgage, would you consider owner financing to a buyer to get your property sold?  We'd love to hear your opinion on this subject.  Just click the comment link below and tell us what you think.

Home Buyer Incentives

The current real estate slowdown has brought out some of the most unusual buyer incentives we've ever seen, from fully paid week-end getaway vacations to brand new cars.  When it comes to buyer incentives however, the simple fact is — money talks.  If you're trying to sell a home in this down market, here are five great buyer incentives that really work.

Pick up the closing costs.  This is especially effective for first time home buyers who are adding closing costs to the amount they financed for the home - it eliminates thirty years worth of interest on those few thousand dollars.

Contribute to the down payment (if allowed by the buyer's lender).  Take whatever you would have spent on an incentive and offer it as down payment assistance.  When you consider that a higher down payment can result in a lower interest rate, a contribution to the down payment could be a powerful incentive.

Pick up the tab for several months of homeowner insurance.  Insurance companies will often discount premiums paid in advance, so you'll get a bargain price.  For home buyers, it means extra cash in those first few months when they'll be settling in and need it most.

Pay for a home warranty for a year.  For home buyers who are already paying insurance and all the other related costs of a new home, the added peace of mind will be invaluable.