Vegan Resources in Charlottesville

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From the Central Virginia Vegan Meetup Group to various restaurants and grocery stores, including a wonderful Vegan Guide to Charlottesville restaurants, it seems that Charlottesville offers an awful lot of options for vegans and vegetarians. I’m not nearly educated enough on this topic as I should be, but when incoming buyer clients asked me about Charlottesville options, I turned to the best resource available to me – Twitter and Facebook.

Practicing real estate is absolutely about representing buyers and sellers, but it’s also about educating and introducing clients to my town and providing local insight that they might not get from the google.

Click through to see the embedded storify with Charlottesville Vegan and Vegetarian resources.

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Qualifed Mortgages Started Today. So What?

in General Real Estate on

Part 1 of 2. (here’s part 2)

Qualified Mortgages and the FUD associated with them are very much in the (real estate) news right now – they’re new, they’re as of yet unknown and they’re going to have an impact on the residential real estate market. As many readers know, I’m an advocate of seeking experts and borrowing and sharing their knowledge and expertise. Matt Hodges with Presidential Mortgage is one of those experts (and one of the lenders I recommend to clients).
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Qualified Mortgages…what? Yes, the Consumer Finance Protection Bureau (CFPB) issued their final report in December, 2013 entitled “Ability-to-Repay and Qualified Mortgage Rule”.

These regulations officially go into effect on January 10, 2014.

Is this much ado about nothing or drastic changes to the mortgage industry? Let’s examine. Specifically, Home Equity Lines of Credit (HELOC), Reverse Mortgages, land loans, construction loans and most bridge loans are excluded. We are primarily describing changes to first lien, “forward” mortgages on homes.

The Ability-to-Repay (ATR) section includes eight features, most of which we have been complying with for years:

  • Income and/or assets needed to qualify will continue. Lenders must not count on verbal income assertions from clients… we must verify that income is real and will continue.
  • Current employment has been verified.
  • Monthly mortgage payment is used to qualify. An additional change is that certain Adjustable Rate Mortgages must be qualified at a higher than start rate, versus the “teaser” initial rate. Initial interest only periods must be ignored, and borrowers must be qualified, as if the mortgage was amortized.
  • Monthly payment for any simultaneous loan/line is calculated in debts – i.e. HELOCs. These are often used in conjunction with a first loan in order to avoid mortgage insurance or non-conforming/jumbo loans.
  • Inclusion of taxes, insurance and home owner’s association fees, if applicable must be included in the debt load.
  • Debts, alimony and child support should be calculated.
  • Debt to income (DTI) and/or residual income must be calculated. We’ll come back to this one – it’s important. ATR does NOT state a maximum DTI.
  • Credit history. Wow, that’s a shocker!

Lenders may and have instituted residual income calculations for conventional loans, like Wells Fargo. From a common sense perspective, this is reasonable. VA loans (except Interest Rate Reduction Refinance Loans- IRRRL) include that calculation, to insure that those debts not found on a credit report are included. Those include child care costs, maintenance and utilities on the home and deductions from gross pay.
What if a loan goes into default? If the lender can prove they followed the eight steps and something occurred like an unexpected layoff of the borrower’s employment, then the lender has a “safe harbor”, safe from liability or a “rebuttable presumption.” I’m no lawyer, so I won’t delve further.

Part 2, coming Monday, will cover Qualified Residential Mortgages themselves.

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Buyers – Do you Think about This when You Post on Facebook?

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In January 2012 I noted that you should Choose Your (Social) Friends Wisely – “ They Could Affect Your Ability to Buy a House.

In April 2012 I wrote words of warning to those involved in real estate transactions (real estate agents, too) to Don’t Talk about your Real Estate Negotiations (on Social Media)!.

2014 brings word that lenders are more avidly farming social media to ascertain buyers’ creditworthiness. This makes complete and total sense. I google many (most?) of the people I meet. If deciding to hire someone, checking out their social media profiles is a reasonable step of due diligence. Why wouldn’t lenders check potential borrowers’ social media? (other than the fact that big banks can’t be trusted)

From the Wall Street Journal:

Lending companies … are looking at potential problems such as whether applicants put the same job information on their loan application as they posted on LinkedIn, or if they shared on Facebook that they had been let go by an employer. A small business that draws negative reviews on eBay EBAY -0.95% also could undermine its chances of getting more credit, lending companies say.

…

“It’s one of the tools we use to do underwriting,” said Sasha Orloff, co-founder and chief executive at LendUp, which is backed by companies including Google Ventures and expects to make 300,000 loans in 2014. “Do you have 4,000 friends but none are that close, or do you have 30 people but they’re very close? There are ways to measure how engaged and how strong your community ties are,” he said.

I can imagine that life insurers would check to see if someone who says they’re not a high risk is prone to skydiving on weekends, or other such risky adventures. Reasonable, right?

In other words – Be careful what you post online.

I do wonder … could lenders one day ask for your gmail login credentials to see your networks? Or if buyers could use “do you check my social media profiles” as a means to evaluate lenders?

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Brief Real Estate Market Update for January 2014

in Albemarle Charlottesville Market statistics on

A snippet from my monthly note:

Market Update for Charlottesville and Albemarle:

Single family home sales in December 2013 vs December 2012: 87/89 – Same, as far as I’m concerned
Single family home sales in 2013 vs 2012: 1302/1215 – Up 7%

Attached home sales in December 2013 vs December 2012: 23/24 – Close enough to be the same.
Attached home sales in 2013 vs 2012: 441/339 – Same

Condo sales in December 2013 vs December 2012: 6/13 – Down 54%
Condo sales in 2013 vs 2012: 167/234 – Down 29%

Keep in mind that these stats are likely not completely up to date, as agents are still entering in closings from 2013. But they’re likely close enough to say that there were a few more Charlottesville/Albemarle single family homes sales in 2013 than 2012, attached home sales were about the same and condo sales were way down (mainly because Walker Square condos sold out in 2012). And you know what? We’re due for some stability, free of spikes and drops.

List sooner rather than later (Y’know, I’m a Realtor. You could call me . 🙂 )

I suspect that we’re going to see more inventory as the year progresses.

More inventory means more competition and selection for buyers. More competition means potential price appreciation for sellers is likely to be diminished.

Charlottesville MSA Listed, Contract, Sold.png

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Crozet in 2013

in Albemarle Blogging on

The more I’ve thought about this, the more I hope to make time to got back and do a wrap up for 2012, 2011, 2010 …

If you’re interested in what happened in Crozet, I went through the 2013 archives and chose what I thought to be the best and most relevant stories in 2013 . I’m posting this for two reasons:

1 – I think it’s a useful story.

2 – It’s an example of why I continue to write on this and that blog; putting together this type of year end summary as efficiently as I did would be impossible on any other platform (Facebook, G+, Twitter, etc)

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A Few Homeowners Insurance Questions Answered

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I like experts. My clients come to me seeking solutions and part of the solution is helping them assemble the right team to help throughout the process. Everyone needs homeowners’ insurance and I tend to recommend Gary – I’ve found him to be helpful, knowledgeable and willing to share knowledge. I asked him to answer a few questions that most (new) homebuyers have.

By Gary Albert with State Farm.

Q: What is the purpose of home insurance?

A: For many, your home is the most important investment you make. So it makes sense that you would

want to protect that investment through homeowners insurance. The fundamental basis of insurance is the transfer of risk from one person or entity to another. We make decisions daily about risk in our personal lives, and each of us have a different tolerance for retaining risk compared to our neighbors. As it relates to homeowner’s insurance, the premium we pay speaks to how much of this risk we are retaining versus how much we are transferring to the insurance company.

Q: Tell me more about deductibles.

A: When you file a claim, the homeowner is responsible for a predetermined part of the costs. This is called a deductible. As a general rule, a low deductible will result in higher premiums, and a higher deductible will result in lower premiums. There is no template rule of what deductible to carry. There are some that advocate for the lowest deductible available and some that lean toward the other end of the spectrum, looking for the higher deductible options. It’s best that you figure out what works best for your particular situation.

To help make this decision, consider your financial situation and personal emergency savings in the event of a large loss to your home.

Q: How are rates set? Do weather disasters in other parts of the country impact the rates we pay here in Virginia?

A: At State Farm, we use claims experience from the past several years to project the cost of future claims. The ratemaking process also factors in trends such as the costs for construction, medical payments and other variables.

Rates are based on each state’s claims experience. This means premium dollars stay within the state and do not compensate for losses in other states. So a wildfire in California will not have an impact on our rates here in Virginia.

Q: What about homes that need some work? Is there anything from an insurance point of view you should know when buying a fixer-upper?

A: First, make sure you work with reputable contractors. Get quotes from a few licensed contractors to find the best deal. You also want to make sure the contractor has liability and workman’s compensation insurance to protect you if someone is injured on the job.

Once you are done fixing up the house, make sure you check in with your insurance agent to see if you need to change your coverage. The upgraded kitchen you added could increase the cost to rebuild if something were to happen, and you want to make sure you’re adequately covered.

What’s a CLUE Report? How is it used in the home buying process?

Comprehensive Loss Underwriting Exchange, 7 year database of claim information. Only the owner or the insurer, or lender can access the information. This service is maintained by Lexis Nexis.

When considering making a purchase of a home, involve an insurance company early in the process to run this report. Some carriers may not do this upfront, so be sure to ask if this report is being run at the time of the quote. If there are prior losses on the property, the insurer (and prospective home buyer) will want to research the repairs and get ahead of any potential loss/insurability concerns. I recommend doing this before the home inspection.

Q: Anything else to add?

A: Insurance can be very personal. Meet with your insurance professional on a regular basis to make adjustments to your coverage as needed for updates, improvements, additions, and endorsement review. Our community has many local, reputable insurance agents. If you’re unsure of whom to speak with, ask your neighbor, good neighbors are usually good sources of information.

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