Good Faith Estimate contains some quirks

As of Jan. 1, 2010, the Department of Housing and Urban Development (HUD) required lenders to provide mortgage borrowers with a new three-page Good Faith Estimate (GFE) to protect consumers who are applying for a mortgage.

The intent of the GFE is to educate consumers about the key terms and costs of a mortgage, both at origination and ongoing. A loan originator completes the form, giving the borrower a summary of the loan particulars and information necessary to shop rates and to be sure they’re comparing like-type mortgages.

Although there’s grumbling, mostly from mortgage brokers, lenders and closing/escrow agents, the format and information included in the new GFE is a step in the right direction. There are, however, some quirks.

For example, the GFE doesn’t provide a complete and accurate account of the borrower’s costs. Page two provides an itemization of loan origination and settlement costs. The origination charge is itemized as one lump sum; it’s not broken down.

So, you don’t know how much you’re paying the appraiser for the appraisal, the loan originator for the origination fee, or other miscellaneous fees.

Another shortcoming is in the way transfer taxes are disclosed. The entire amount of any transfer taxes is entered on the GFE, even if the sellers pay part or all of it. This could inflate the buyer’s estimated settlement costs.

To get around having to generate a GFE for buyers before they have committed to a given loan originator, some mortgage originators have developed worksheet quotes for buyers to use if they want to shop rates. HUD is adamant that these worksheets can’t be used instead of a GFE. Furthermore, they provide the borrower no protection.

HOUSE HUNTING TIP: The new federally mandated GFE provides protection for borrowers against being charged extra fees at closing that weren’t disclosed on the GFE. An informal worksheet provides no such protection.

Origination and settlement fees are grouped into three different categories. The first category is fees that can’t increase between the time the GFE is issued and closing. Included in this category are the lender or mortgage broker’s origination fee, transfer taxes and adjustments to loan origination charges after the borrower locks in an interest rate.

Loan originators who miscalculate, causing fees to run higher at closing, have to make up the difference out of pocket. To cover themselves, some loan originators pad the Category one figure.

The second category of fees can increase up to 10 percent at closing and includes such things as government recording charges and title insurance — if the title insurer is identified by the lender, not by the borrower. This is done to encourage lenders to shop for the most cost-effective coverage for the consumer.

The third category of fees can change at settlement and includes homeowners insurance and title insurance coverage if the borrower, not the lender, identifies the title insurer.

The new GFE also includes a tradeoff table that shows what the interest rate would be if you paid a higher origination fee vs. a lower origination fee: the higher the fee, the lower the rate; the lower the fee, the higher the rate.

Finally, there’s a loan-shopping chart to use the mortgage information provided by one lender to compare with other lenders. There is no obligation to use a loan originator who completes a GFE for you. A loan originator can’t refuse to provide a GFE to a prospective borrower who asks for one.

As soon as a prospective borrower provides essential application information, such as Social Security number, property address, etc., the originator is to provide a GFE.

THE CLOSING: Lenders are required to provide a GFE within three days of receiving the borrower’s application.

This article was written by Dian Hymer, a real estate broker with more than 30 years’ experience, is a nationally syndicated real estate columnist and author.


Interior Designers Share Their Favorite Wall Colors

  

Have you ever picked a color for a room from a paint chip (even a large one) to find that it looks very different–darker, or yellower, or greener–once it was applied to the walls? 

Well, here is help and  some great tips from interior designers featured in a Better Homes and Gardens slide show to help you choose the right paint color for your walls.  The slides include both pictures of rooms painted in a certain color and the name and brand of the paint they used.  See example below: 

Picture of a room painted with Sea Salt

 

“Gray-blue is a color that’s both modern and classic. It has the versatility of a blue and the contemporary cool of a gray. Sea Salt will look great with almost any accent.” 

The name of the paint is Sea Salt SW 6204 by Sherwin-Williams 

Click on  Interior Designers Share Their Favorite Wall Colors to see all 13 slides. 

If you are repainting the entire house however, you may want to consider hiring a color consultant.  Many of my clients use color consultants to recommend a color palette with different colors that complement each other within the home .  They usually find it a well worth investment and are very satisfied with the results. 

Feel free to contact me for a recommendation for a color consultant in Marin County.  Call me at 415-505-4789.


1031 Exchanges and Foreclosures, Short Sales and Deeds in Lieu

 

While most people understand that foreclosures, short sales and deeds in lieu of foreclosure have significant economic consequences (loss of property; loss of equity; and loss of credit rating), what is not apparent to most people is that there are significant taxable consequences even if the owner walks away with no cash. While an IRC §1031 Tax Deferred Exchange can, in theory, be utilized under these circumstances to defer the capital gain tax consequences, certain practical and technical challenges may make a tax deferred exchange problematic for many taxpayers.

Foreclosures, Short Sales and Deeds in Lieu, are defined, as follows:

Foreclosure: Foreclosure is an involuntary process whereby a lender repossesses property that was pledged as collateral for mortgage debt. Foreclosure can occur judicially (i.e. through a court action) or non-judicially, where a third party, such as a trustee, has the power to conduct a sale of the property after the lender has declared a default of the loan. 

Short Sale: A short sale occurs when an owner sells property for less than the debt owed on the property. The lender must consent to the sale, agree to accept less than the full loan amount, and agree to release the property from the mortgage lien.

Deed in Lieu of Foreclosure: A deed in lieu of foreclosure occurs when an owner conveys property to the existing lender in exchange for cancellation of the mortgage debt—i.e. “in lieu” of a foreclosure by the lender.

Taxable Consequences of Foreclosures, Short Sales and Deeds in Lieu:

Each of the above circumstances results in two potential taxable consequences to the owner; (1) tax on gain; and/or (2) tax on cancelled or forgiven debt. Whether the debt is recourse or non recourse dictates whether there is one or both of these tax consequences.

Non-Recourse Debt: (borrower not personally liable)
There is one tax consequence. Capital gain is taxed at the applicable capital gains rate—either 5% (for those in the 10% and 15% income tax brackets) or 15% (for those in the 25% or higher income tax brackets). The amount taxed is the difference between the debt and the adjusted basis. There is no tax on cancellation or forgiveness of debt.

Recourse Debt: (personal liability to borrower)
There are two tax consequences:

(1) Cancellation or forgiveness of debt is taxed as ordinary income. The amount taxed is the difference between the debt and the fair market value (“FMV”); and

(2) Capital gain is taxed at the applicable capital gains rate—either 5% (for those in the 10% and 15% income tax brackets) or 15% (for those in the 25% or higher income tax brackets). The amount taxed is the difference between the adjusted basis and the FMV.

Given the foregoing, there is always the possibility that there is a taxable gain even when the owner receives no cash.

For example: Smith buys an apartment building in 1978 for $400,000 cash. The property appreciates in value, and in 1992, he obtains a loan of $350,000. The property continues to appreciate and—by 2004—the building’s FMV is $2 million. Smith obtains a second loan of $850,000. However, in 2010, the property diminishes in value to $1 million, but his outstanding loans total $1.2 million and he is struggling to make the payments. Smith considers a short sale for the FMV of $1 million. Since Smith has owned the building for over 33 years, he has fully depreciated it and the adjusted basis is $0.

Tax consequences if debt is non-recourse:
If the debt which is the subject of the foreclosure, short sale or deed in lieu of foreclosure, is non-recourse, capital gain must be recognized to the extent the debt exceeds the owner’s adjusted basis.

In the example above, Smith’s debt is $1.2 million and his adjusted basis is $0. Hence, he must pay federal capital gains tax (either 5% or 15%, depending on his income tax bracket) on $1,200,000 (5% would be $60,000—15% would be $180,000). Additionally, unless he lives in a state with no income tax, he will pay state income tax on his capital gain.

Tax consequences if debt is recourse:
If the debt which is the subject of the foreclosure, short sale or deed in lieu of foreclosure, is recourse, capital gain must be recognized to the extent of the difference between the FMV of the property (here, $1 million) and the adjusted basis (here, $0). Hence, Mr. Smith must pay capital gains tax (either 5% or 15%) on $1 million.

In addition, there is a second tax consequence—i.e. cancellation of debt income. Mr. Smith must pay ordinary income tax (anywhere between 10% and 35%, depending on his income) on the difference between the FMV ($1 million) and the existing debt ($1.2 million). Thus, he must pay income tax on $200,000.

In sum, if the debt is non-recourse, Mr. Smith pays capital gains tax on $1.2 million. Alternatively, if Mr. Smith’s debt is recourse, he will pay capital gains tax on $1 million and he will pay ordinary income tax on $200,000.

Can the tax consequences of a foreclosure, short sale or deed in lieu be ameliorated by a §1031 exchange?

In theory, although structuring a foreclosure, short sale or deed in lieu in the context of an exchange may ameliorate the capital gain tax consequences, these transactions present practical and technical difficulties—if not, complete obstacles – to including them as part of a tax deferred exchange, such as:

•No cash is available to complete acquisition of replacement property;
•Credit is adversely impacted and thus financing to purchase replacement
• property is unlikely;
•In a foreclosure there is no contract of sale for the taxpayer to assign to the Qualified
• Intermediary (required by the Treasury Regulations for an exchange);
•A short sale or deed in lieu may have a written agreement to assign to the Qualified
• Intermediary, but it is questionable as to whether the IRS would accept such an
• assignment.

In sum, owners should recognize that even though their property is under water and they will receive no cash from its disposition, the tax consequences remain significant. Owners facing foreclosure, short sale or a deed in lieu should plan as far in advance as possible for the taxable consequence resulting from the transaction.

For further information regarding the above, you may wish to visit the following link located on the IRS website: http://www.irs.gov/newsroom/article/0,,id=174034,00.html

Choose OREXCO to handle your next exchange. We have offices nationwide to serve you and/or your client’s exchange needs. For more information about OREXCO and its QI services, please go to www.orexco1031.com.

Taxpayers contemplating an exchange should always consult their tax or legal advisor.

Guest Writer Toni Esposti, CES®/CSEO/CEI  is the Vice President for OREXCO 1031 Exchange (Old Republic Exchange Company), a Qualified Intermediary company specializing in IRC § 1031 exchanges in the North Bay.  For more detailed information call Toni at 888.677.1031.

Old Republic Exchange Company
545 4th Street, Suite 210 • San Rafael, CA 94901
www.orexco1031.com
© 2010 Old Republic Exchange Company™

 


How to build wealth and save taxes

 

 

If I told you I knew how you could get an interest free loan that you didn’t have to pay back until you were ready, would you be interested?  Who wouldn’t!?  Essentially, this is what you get when you use an Internal Revenue Code Section 1031 Tax Deferred Exchange (IRC § 1031) to your advantage.  When you sell real property that you hold for investment purposes and replace it with other real property provided both properties are either held for investment of used in a trade or business.

 With a combined rate for both Federal and California State tax of approximately 25% and the potential of it being more if you have to consider recapture of depreciation, the motivation to use an exchange to defer capital gains is clear.  If the Capital Gain on a property being sold is $100,000, the tax may be in excess of $25,000.

 By using an exchange, an investor (exchanger) can sell his property, defer the capital gain tax and leverage the entire equity to acquire replacement property.  In order to complete a successful exchange and fully defer capital gains, the exchanger must comply with certain requirements and strict time lines that are outlined in the code.

For example, the exchanger has 45 days from the day escrow closes on the relinquished property, to identify in writing potential replacement properties.  After the 45th day, the exchanger cannot change the properties identified and the Exchanger has 180 days from the close of escrow of the relinquished property to close escrow on one or more of the identified replacement properties.

 To fully defer capital gains, the exchanger must acquire replacement property that is equal to or greater than the net value of the relinquished property.  Likewise, he must fully reinvest all the net equity and replace the existing loan with either a new loan on the replacement property or add cash equal to or greater than the debt existing on the relinquished property when purchasing the replacement property.

 It is always advisable to consult with your legal or tax advisor when considering an exchange.  Used correctly, the IRC § 1031 Tax Deferred Exchange can help an investor build wealth and save taxes.

Guest Writer Toni Esposti, CES®/CSEO/CEI is the Vice President for OREXCO 1031 Exchange (Old Republic Exchange Company), a Qualified Intermediary company specializing in IRC § 1031 exchanges in the North Bay.  For more detailed information call Toni at 888.677.1031.


Yes, You Can Still Get A Mortgage If You’re Pregnant

The New York Times ran an important story this week concerning pregnancy and mortgage approvals. Titled “Need a Mortgage? Don’t Get Pregnant“, the article discussed the difficulties that expecting and recently-expanded families are having with their mortgage financing.

NBC’s The Today Show picked up the story as well, as shown in the 3-minute clip above.

The crux of the issue is that maternity/paternity leave often leads to a change in household income and mortgage lenders will no longer assume one or both parents will go back to work full-time.  The loss of income can raise a household’s debt-to-income ratio to unlendable levels.

Now, your loan officer cannot ask you about a pregnancy; such questions would be violation of Equal Credit Opportunity Act. But he can ask if whether you expect your future employment and income situation to change. This would be a perfect time to broach the topic. And you should. If you’re found to have withheld employment and income information from your lender at a later date, it could result in an immediate loan denial plus a loss of earnest monies paid.

Across both pieces, though, the prevailing message is this: Families concurrently planning to (1) have a baby and (2) buy a home should be up-front and forthcoming with their loan officers. Financing is often still available for families expecting an addition — there’s just some extra paperwork though which to work.

Be prepared for that paperwork and you’re more likely to get your loan.

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About the author: The above Real Estate information on Marin County Real Estate was provided by Sylvie Zolezzi.  I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789.  I help people move in and out of Marin County, just north of the Golden Gate Bridge.

I am here to help you make the smartest real estate move and build wealth, providing you with reliable real estate information and advice you can trust.

My knowledge and passion for Marin County are equaled by my commitment to helping you successfully navigate the process of buying and selling a home.  My business model enables me to provide superior service and a better client experience.  I know the neighborhoods, the schools, the amenities; I know where you want to live.  I know and love Marin County! 

I service the following towns in Marin County: Sausalito, Tiburon, Belvedere, Mill Valley, Corte Madera, Larkspur, Greenbrae, Kentfield,  Ross, San Anselmo, San Rafael, Fairfax, and Novato.


Make Your Marin County House FHA-Loan Friendly

  

If you are thinking of selling your Marin County home, here is some advice you will want to heed from this interesting article from Houselogic on the importance of making your house FHA-loan friendly before you put it on the market.  

Please note that the FHA limit for Marin County is $729,750 for single family homes. 

 Read the article below (or click on the link: Make Your House FHA-Loan Friendly | Buying Selling | HouseLogic.) 

Corte Madera Creek in Greenbrae, CA

 

Know the basics of FHA loan rules and you stand a better chance of selling your house or condo. 

Make your house FHA-friendly, and it will appeal to more homebuyers. Why? Because the Federal Housing Administration is insuring the mortgage loans used by about 30% of today’s homebuyers. 

If your house passes the FHA rules, it will appeal to buyers who plan to use an FHA-insured mortgage. If your house doesn’t qualify for an FHA loan, you’re cutting out 30% of potential buyers. 

FHA is especially important to first-time homebuyers and those with small downpayments because it allows borrowers with good credit to make a downpayment as low as 3.5% of the purchase price. 

Here’s how to make your home appealing to FHA borrowers: 

Know the FHA loan limits in your area

Start by checking to see if your home’s listed price falls within FHA lending limits for your area. FHA mortgage limits vary a lot. In San Francisco, FHA will insure a mortgage of up to $729,750 on a single-family home. In the White Mountains of New Hampshire, the loan limit is $271,050. 

Home inspections

Mt. Tamalpais view from Greenbrae, CA

 

Most buyers will ask for a home inspection, whether or not they’re using an FHA loan to buy the home. You must give FHA buyers a form explaining what home inspections can reveal, and how inspections differ from appraisals. 

How much do you have to repair?

If the home inspection reveals problems, FHA will not give the okay to buy the home until you repair serious defects like roof leaks, mold, structural damage, and pre-1978 interior or exterior paint that could contain lead. 

Dealing with FHA appraisers

Help the lender’s appraiser by providing easy access to attics and crawl spaces, which usually must be photographed, says appraiser Frank Gregoire in St. Petersburg, Fla. 

Your buyer can hire his own appraiser to evaluate your home. But FHA only relies on reports by its approved appraisers. If the two appraisals conflict, the FHA appraisal preempts the buyer’s appraisal. 

Help with FHA closing costs

Most FHA buyers need help with closing costs, says mortgage banker Susan Herman of First Equity Mortgage Bankers in Miami. So a prime way to make your house FHA-friendly is to help with those costs. 

FHA currently allows sellers to pay up to 6% of the sales price to help cover closing costs, but is considering lowering that limit to 3% in the fall of 2010.  

If you’re selling a condo

Swimming Pool - Spyglass Condominiums, Greenbrae, CA

 

FHA also has to approve your condo before a buyer uses an FHA loan to purchase your unit. Be sure your condo is FHA-approved for mortgages. The list has been updated, so if your association was approved a year ago, check again to make sure it’s still on the approved list. 

FHA generally won’t insure loans in condo associations if more than 15% percent of the unit owners are late on association fees. Ask your property manager or board of directors for your association’s delinquency rate. 

Other rules cover insurances, cash reserves and how many units are owner-occupied and the types of condos that can be purchased with an FHA mortgage

FHA sometimes issues waivers for healthy condominiums that don’t meet the regular rules. If your condo isn’t FHA-approved, it doesn’t necessarily have to meet every single rule to gain approval. Ask your REALTOR® to consult with local lenders about getting an FHA waiver for your condo if it doesn’t meet all the requirements. 

FHA also limits its mortgage exposure in homeowners associations. With some limited exceptions, no more than 50% of the units in an association can be FHA-insured

FHA loans for planned-unit developments

FHA no longer requires lenders to review budgets and legal documents for planned-unit developments. 

More from HouseLogic

Show Your Support for FHA 

Other web resources

Why Ask for an FHA Loan? 

Find a State Program to Help Homebuyers Afford Your Home 

Terry Sheridan is an award-winning freelance writer who has covered real estate for 20 years, and has owned and sold three homes. 

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Please contact me at Sylvie@YourPieceOfMarin.com or call or text me at 415-505-4789 with any questions about the sale of your home.  Thinking of buying a piece of Marin County, I can help too.  Call or text me at 415-505-4789.   

All photos  by Sylvie Zolezzi 


Marin County Market Update – June 2010

     

IMPROVED CONSUMER SENTIMENT:   

Reuters recently reported that consumer sentiment rose again in June and reached its highest level since January 2008. As I have repeatedly written in my recent market updates, I strongly believe that the health of the housing market is very closely tied to the health of the overall national economy and consumer confidence.  Consumer sentiment is seen as a proxy for consumer spending, which fuels around 70 percent of the U.S. economy.  How well the economy does impacts jobs, and jobs impact homeowners’ ability to pay their mortgage, which in turn has a huge impact on the real estate market.   

 MARIN COUNTY MARKET STATISTICS:   

Corte Madera Creek, Greenbrae, CA

 

 Home buyers in Marin County indeed demonstrated increased confidence this past June.  Sales of single family homes in Marin continued their upward trend: 219 homes were sold vs. 191 in May 2010 (a 14.66% increase month over month) and 186 in June 2009 (a 17.74% increase year over year).  This was the highest number of single family homes sold in Marin County since June 2007 when 226 sold.     

 The numbers however show a definite deceleration from the rapidly increasing sales we have witnessed for the past 9 months.  Why such a slowdown in this increase?  First, with the expiration of the federal tax credit and its short-term stimulating effect on sales, the Marin County real estate market is facing a key inflexion point as we head into the thick of summer vacation season.  Many buyers and sellers bought and sold early and most of the escrows opened before the deadline of April 30 closed by the end of June.  It will be interesting to see what July numbers look like.    

Secondly, we were playing catch up and moving our way back to about “normal” sales volumes compared to historical data for the County.    

 Sales of Single Family Homes – Marin County

  Sold Listings   Sold Lisings %  increase  
October 2008 122 October 2009 174 42.62%  
November 2008 90 November 2009 169 87.78%  
December 2009 91 December 2010 179 96.70%  
January 2009 71 January 2010 95 33.80%  
February 2009 62 February 2010 107 72.58%  
March 2009 90 March 2010 147 63.33%  
April 2009 107 April 2010 160 49.53%  
May 2009 147 May 2010 191 29.93%  
June 2009 186 June 2010 219 17.74%  

Comparing to the highs and lows over the past five years, here is where we are:   

–       Sold single family homes:   

  • High: August 2005 – 259
  • Low: February 2009 – 62
  • June 2010 – 219

 –       Average Sales Price:   

  • High: September 2007 – $1,485,000
  • Low: February 2009 – $802,000
  • June 2010: $1,037,000

 –       Expired/Cancelled:   

  • High: December 2008 – 206
  • Low:  August, October 2005, January-March 2006 – 0 (yes, zero!)
  • June 2010: 157.
Bay View from Corte Madera,CA hills

 

In terms of other market data, here is a quick rundown of the numbers for Single Family Homes for the whole county:   

–       Inventory was down month over month to 1,161 from 1,229 as of 6/30/2010   

–       Percentage in contract was down as of 7/6/2010 to 24.35% in contract vs. 25.66% as of 6/8/2010.   

–       Sales price staying pretty flat with an average of $1,037,000 for June 2010 vs. $1,034,000 for June 2009.   

–       Median price slightly down at $815,000 vs. $833,000 in June 2009.   

–       Three month average price per square foot up to $479 from $457.   

–       New listings up to 366 for June 2010 from 292 in June 2009.   

–       Expired or cancelled (usually listings which linger on the market and do not attract buyers) still high at 157 for June 2010 vs. 127 in June 2009.   

–       Days on market down to 90 from 102 in June 2009.   

–       24.35% of single family homes were in contract as of July 6, 2010, which is considered to be a balanced market.    

  BREAKDOWN BY PRICE RANGE:

Marin County – Single Family Residences as of July 06, 2010  
  Total Active In Contract % In Contract
ALL PRICES 1269 309 24.35%
0-$999K 662 222 33.53%
1MIL-$1,999K 369 56 15.18%
2MIL-$2,999K 121 21 17.36%
$3MIL + 116 9 7.76%

 Sales of homes in the $1 million and up segments are all showing reductions, despite a trend in the first half of the year showing high-end properties starting to sell again.    

Spyglass Condominiums - Greenbrae, CA

 

  Condominiums sales remained flat at 91 compared to June 2009, but edged up from 80 in May.  Inventory was down slightly from 331 in June 2009 to 299.  Expired/cancelled listings went up from 38 to 46.   

 THE MEANING OF EXPIRED/CANCELLED LISTINGS:   

Let’s take a closer look at expired/cancelled statistics.  They are seldom mentioned but I find them very useful in taking the pulse of the market.  They say a lot about what is really going in a market.  Generally, most people in my industry categorize the market as either a buyer’s market or a seller’s market.  If there are more sellers than buyers, it’s clearly a buyer’s market and vice versa.  But today’s market does not fit that simplistic binary mold.  While raw numbers point to a balanced market with an average of 25% in contract, the high number of expireds tells a different story. It is a transitional market, but no one really knows what it is transitioning to.  The high number of expired/cancelled listings is a sure sign that inventory is bloated with a great number of overpriced homes.  Many are short sales waiting to happen (properties lingering on the market priced at what their owner owes on the property instead of the current market value).  They often are withdrawn to reappear as a short sale and later as a bank owned property.    

Lark Theater in downtown Larkspur, CA

 

 The buyers with whom I work quickly realize that the apparent broad availability of homes is deceiving when they start (1) applying their must-haves (bedrooms, schools, price, availability within their time frame), (2) discarding the obviously overpriced homes, and understanding whether or not the seller is realistic, (3) determining if the incredibly low-priced homes are too good to be true (i.e. priced to attract an offer to convince the bank to accept a short sale), if the house can appraise, if the house is a total fixer-upper, if financing is available and they will be able to lock a loan this century, and (3) if the house has passed all the above tests, understanding that if they are looking at this house, someone else is and they will be competing for it.    

 That being said, if you are a buyer, it might be hard work and take a bit of time, but if you move fast when you find the right house, you can lock up the lowest prices Marin County has seen in many years and sublimely low-interest rates.  Definitely worth it in my book!   

Seminary in San Anselmo, CA

 

Sellers, this is not the time to “test” the market; price your home according to recent comparable sales and make sure it shows amazingly well.  Buyers will see the value and snap up your property.  If you are thinking of moving up, you can take advantage of the same discount you are getting on your lower priced home on a higher priced home.  Do the math, you will be pleasantly surprised.  Generally, properties have lost about 20 to 30% in value from the height of the market.  For simplicity’s sake, let’s use a 20% discount rate and assume your home was worth a million back in 2007:  it is now worth $800,000, or $200,000 less.  Your dream home that was worth $1,600,000 in 2007 is now worth $1,280,000, or $320,000 less…   

 THE MARIN MARKET EPITOMIZES THE OLD EXPRESSION THAT REAL ESTATE IS FIRST AND FOREMOST LOCAL:    

One thing is sure: real estate is more local than ever.  It is so local that each town in Marin, each community, each neighborhood, each street is its own micro market.  Drilling down to City by City numbers (for Single Family and Condos), the market is a tale of many cities, with each city telling its own story:

City Total Active In Contract % In Contract Average Sales Price
Sausalito 87 19 21.84% $960,000
Belvedere 40 2 5.00% $3,242,000
Tiburon 127 18 14.17% $1,716,000
Mill Valley 211 47 22.27% $1,216,000
Corte Madera 51 18 35.29% $992,000
Larkspur 41 12 29.27% $1,009,000
Greenbrae 41 13 31.71% $858,000
Kentfield 43 10 23.26% $1,848,000
Ross 27 3 11.11% $1,094,000
San Anselmo 82 20 24.39% $956,000
Fairfax 45 10 22.22% $756,000
San Rafael 385 112 29.09% $634,000
Novato 333 116 34.83% $551,000

   

 I make it my business to understand the numbers, and follow the trends closely.  I know the neighborhoods and can provide you with the right guidance.  Whether you are thinking of buying or selling, or are just curious to find out how much your home is worth, contact me.   

All photos by Sylvie Zolezzi


Mandatory Loan Fees Keep Borrowers From Getting Their Absolute Lowest Rate

Loan-level pricing adjustments add to mortgage costsConforming mortgage rates may be posting all-time lows this week, but that doesn’t mean you’ll be eligible for them. You may have already called your loan officer and found this out the hard way.

It’s because of a federally-mandated mortgage-pricing scheme known as “loan-level pricing adjustments”.

In effect since April 2009, loan-level pricing adjustments are changes to a loan’s base rate and/or fee structure based on that loan’s inherent risk to Wall Street. It’s similar to auto insurance pricing adjustment in that a sports car, all things equal, will cost more to insure than a comparably-priced minivan.

More risk, more cost.

In mortgage lending, loan risk can be loosely grouped into 5 categories. Mortgage applications featuring any of the five traits are subject to price adjustments:

  1. Credit Score (i.e. the borrower’s FICO is below 740)
  2. Property Type (i.e. the subject property is a multi-unit home)
  3. Occupancy (i.e. the subject property is an investment home)
  4. Structure (i.e. there is a subordinate/junior lien on title)
  5. Equity (i.e. mortgage insurance is required by the lender)

Furthermore, loan-level pricing adjustments are cumulative.

A 3-unit investment home will face larger adjustments than an owner-occupied 3-unit home, for example. It’s these adjustments that explain why you may not be eligible for the rates you see advertised online and in the newspapers — your particular loan may be subject to this risk-based pricing that raises your mortgage rate and closing costs.

The government’s loan-level pricing adjustment schedule is public information. See what your lender and how your loan quote is made at the Fannie Mae website. Or, if you find the charts confusing, just call or email your loan officer for help with interpretation.

Novato's Farmer's Market

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About the author: The above Real Estate information on Marin County Real Estate was provided by Sylvie Zolezzi.  I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789.  I help people move in and out of Marin County, just north of the Golden Gate Bridge.

I am here to help you make the smartest real estate move and build wealth, providing you with reliable real estate information and advice you can trust.

My knowledge and passion for Marin County are equaled by my commitment to helping you successfully navigate the process of buying and selling a home.  My business model enables me to provide superior service and a better client experience.  I know the neighborhoods, the schools, the amenities; I know where you want to live.  I know and love Marin County! 

I service the following towns in Marin County: Sausalito, Tiburon, Belvedere, Mill Valley, Corte Madera, Larkspur, Greenbrae, Kentfield,  Ross, San Anselmo, San Rafael, Fairfax, and Novato.

 


How To Install A Ceiling Fan In Your Home

Up to 50% of your home’s energy bill can be tied to heating and cooling costs.  Thankfully, it’s easy to lower those bills.  The addition of a ceiling fan can cut your household energy bills dramatically.

Plus, the installation may be simpler than you think.

In this 4-minute video from the Lowe’s YouTube collection, you’ll learn how to measure, mount and install a ceiling fan, step-by-step:

  1. Choose the right-sized fan for your room based on its “longest wall”
  2. Cut the power to your room, and test that the power is off
  3. Assemble a ceiling fan
  4. Secure a ceiling fan motor to the ceiling
  5. Restore power to the room

If you’re uncomfortable around electricity, or feel the video’s instructions are “too complicated”, by all means, call an electrician.   The money you spend on installation will be dwarfed by what you save in energy bills.

For an electrician referral, reach out to me anytime by phone or email.  I am happy to help you.

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About the author: The above Real Estate information on Marin County Real Estate was provided by Sylvie Zolezzi.  I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789.  I help people move in and out of Marin County, just north of the Golden Gate Bridge.

I am here to help you make the smartest real estate move and build wealth, providing you with reliable real estate information and advice you can trust.

My knowledge and passion for Marin County are equaled by my commitment to helping you successfully navigate the process of buying and selling a home.  My business model enables me to provide superior service and a better client experience.  I know the neighborhoods, the schools, the amenities; I know where you want to live.  I know and love Marin County! 

I service the following towns in Marin County: Sausalito, Tiburon, Belvedere, Mill Valley, Corte Madera, Larkspur, Greenbrae, Kentfield,  Ross, San Anselmo, San Rafael, Fairfax, and Novato.