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By Tara-Nicholle Nelson | Broker in San Francisco, CA

7 Real Estate Risks: Are They Over- or Underestimated?

We tend to speak of the risks of various courses of action in black and white, as risky or not. But the truth is, everything in life has risks - even doing nothing! Behavioral experts, economists and my dear old Dad agree: we’re most likely to make decisions we later regret when we under- or overestimate the risks of the outcomes we hope to avoid.   So, outside of extremely high-risk endeavors like base jumping and going on blind dates, the real challenge in life is not to avoid risk entirely, but to assess it accurately and manage it accordingly.

This need to assess and act on risks appropriately, neither overblowing them or blowing them off entirely, is particularly critical when it comes to real estate risks. It’s easy to let your personality determine how you view and manage real estate risks.  But that’s a costly approach: if you let your personal tendency to be risk averse stop you from ever owning a home, you will also miss out on the personal and financial advantages of home ownership, and the opposite is true. If you take a devil-may-care attitude toward your real estate and mortgage matters, you’re highly likely to make some highly regrettable decisions along the way.  

So, instead of going on risk assessment autopilot, let’s take a quick, yet deep, dive into seven of the real estate-related risks that come up the most often in the minds of smart buyers, sellers and owners like you and how you can manage each of these risks wisely.

Risk #1:  The Risk of Foreclosure. The risk of losing a home has only recently moved to the front of our collective national consciousness. Foreclosure was once a very, very rare event, seen as an unlikely worst-case scenario. But it became a vivid nightmare come true for an all-time high number of home owners during the recession. The risk and fear of foreclosure is largely due to this increase in foreclosure rate over the past few years, and to the vivid, catastrophic nature of the event. Also, almost everyone knows someone who either lost a home or had serious mortgage distress, so it seems like a very common occurrence.

When we take a look at the facts behind this risk, we realize that the risk of foreclosure appears to be much higher than it truly is. There are roughly 76 million owner-occupied homes in the U.S., according to the Census Bureau. Earlier this year, real estate data firm CoreLogic revealed that there had been 3.4 million foreclosures since 2008. That would mean only about  6 percent of homes in America had been through a foreclosure - and this, through the very worst recession of most of our lives.

The more probable risk is the risk of ending up underwater, which more than 25 percent of American homes were at some point during this past 5 years.


The fact that home values rise and fall cyclically is not a risk or a probability - it’s a fact of the real estate market, and one that you can’t do anything about. Your aim should be to manage and minimize the risk of serious mortgage distress (i.e., struggling to make the payment) or foreclosure.  And you have the power to manage these risks by:
  • Making smart mortgage choices. Buying at a price well within what you can afford, selecting a mortgage that your household finances can sustain over time, and not overleveraging by borrowing cash against your home equity for things like cars, clothes or ready cash.
  • Making smart financial moves over time, including building a cash savings cushion you can turn to if a job loss or disability interrupts your income.
  • Buying a home in as desirable a location as you can afford - and in an area with strong prospects for economic and population growth.
  • Making small, extra payments to bring down the principal balance on your loan, if and when you can afford to.

Risk #2: The Risk of Overextending Yourself.  This is a very real risk - more real, even than the risk of actually losing a home. Home buyers can overextend themselves when they take loans that give them falsely low upfront payments;. This was common in the subprime era that many believe led to the recession, but is less likely with today’s tighter lending guidelines and narrow loan programs.

That said, it’s still possible to overextend yourself by taking on more of a mortgage than you can truly afford taking into consideration things that your lender doesn’t include in their estimation of you can affordable, like:
  • what you need to put aside for savings and investments
  • childcare and college or private school tuition
  • the costs of fixing, maintaining or upgrading your home.

There’s only one way to 100 percent manage your risk of overextending yourself when you buy a home, and throughout the time you own it: run your own financials! No matter how much you hate math or hate the thought of restricting your spending, it is irresponsible to buy a home (or be a home owner, for that matter), without regularly running your own monthly spending budget or plan or audit or program or whatever you need to call it to encourage yourself to sit down and do it!  You have got to know with specificity what comes in and goes out every month in order to avoid getting in over your head.

Doing this math - on paper, not just in your head - is critical with almost everything you do as a homeowner, financially speaking.  When you decide to remodel, buy things for your home, upgrade your bathroom, or refinance the place, create and honor the habit of making a written budget - even a super simple one -and doing the actual math to get a clear picture of what it will cost and whether you can afford that.

Risk #3: The Risks of Overpaying and/or Leaving Money on the Table.  The night a buyer and seller agree upon a purchase price, one thing happens in both of their households, almost 100 percent of the time. The buyer wonders and worries that they might have paid too much.  “Would the seller have taken less?” they ask themselves.  And the seller fixates on the reverse, worrying whether they could have gotten more cash out of the buyer. “Would they have paid more?” the seller wonders (and often, asks heir agent).

There is one essential truth about home purchase prices that applies to both buyers and sellers:  you can never know, with 100 percent certainty, whether the other side would have paid more or taken less. The answer to that question exists only in a hypothetical world in which you didn’t offer or take the price you did, in fact, offer or take. So, it simply makes zero sense to fixate on the issue. It’s a drain of time, energy and enthusiasm for an agreement that made enough sense for you to ink, so your best bet is to stop worrying about it.

That said, there are smart strategies buyers and sellers can and should take to minimize the risk of making poor decisions as to purchase price.  Buyers should work with their agents to focus on the recent sales prices of comparable homes as a primary driver, along with their own personal budgets, of the price they offer for any given home. In cases of multiple offers, buyers should make their best offer knowing that you have to offer more than everyone else to “win” the home, by definition . And you should decide, in advance, not to worry or wonder whether a lower price would possibly have worked, if you do turn out to be the victorious buyer.

To avoid leaving money on the table or missing the ‘right’ buyers for their homes, sellers must prepare their homes to the very best of their ability (with advance inspections, repairs and staging, as their agent recommends). Then, price them in accordance with the comparables and their motivation level. The aim should be to price it low enough that the home looks like a compelling value to online house hunters, compared to the competition, but not so low that you  miss out on the buyers who are seeking homes like yours - and also not so low that you would be upset about accepting an offer at the full asking price.


Risk #4: The Risk of Buying a Lemon.  Ever see the Tom Hanks film The Money Pit?  It’s a vivid rendering of every buyer’s fear: that the home of their dreams will turn out to be a nightmare, requiring years of surprise, costly repairs and causing many a daily crisis when this pipe explodes or that roof caves in. Every home has flaws - even brand new ones. But this is a risk that is often overrated in my experience, especially by first-time home owners who have simply not had to maintain a property before.

The reality is that this risk is relatively simple to size up for a given property, and to manage, via inspections and home warranty plans. Talk with your agent about which inspections to order for a given property, but it’s extremely common to obtain at least pest, property and roof inspections for a single family home before buying it. Standard practices for your area, the specific features of a given property and the findings of the other inspectors might suggest that it’s prudent for you to obtain any number of additional inspections or repair bids, ranging from a sewer line inspection, to the inspections of a structural engineer, general contractor, electrician or chimney specialist. Best practice is for you to personally attend as many of these inspections as possible, and read the written reports - as well as asking follow-up questions until you feel comfortable that you understand and are okay with the home’s condition.

The other best practice here is to obtain a home warranty plan at close of escrow to cover the unavoidable, eventual breakdowns of things like furnaces and water heaters. Your agent will help you secure a policy before close of escrow, but it’s your job to keep the home warranty in place every year when it expires.

Risk #5: The Risk of Losing Your Deposit.  In most home buying contracts, there is a window of time after the contract is signed in which the buyer has contingencies: the right to bail out of the deal for any number of negotiable reasons, like if the loan falls through or the inspections reveal insurmountable concerns.  While a buyer may have made a deposit at the very beginning of the contract, it is standard in many areas that the deposit is increased (meaning the buyer puts in more money) and rendered non-refundable at the end of the contingency period.  After that point, if the buyer backs out of the deal, many contracts give the seller the right to retain the deposit money.

The specifics of contingencies and deposit money refundability vary, sometimes widely, state-by-state and contract-by-contract. For example, in the standard real estate purchase contract forms used in California and many other states, the buyer must expressly submit a written form that exercises their contingencies or removes them, telling the seller they are moving forward - the deposit cannot be retained by the sellers unless the buyer first removes their contingencies in writing, then backs out anyway.

In other areas, there is an objection period, so that if the buyer says or does nothing (i.e., fails to “object” to the transaction proceeding), the deposit automatically becomes non-refundable when the objection period lapses.  Almost all bank contracts for the purchase of foreclosed homes follow this passive objection period arrangement, rather than requiring the buyer to actively remove their contingencies for the deposit to be rendered non-refundable.

No matter what the specifics of your contract’s deposit refundability guidelines are, there is almost never a good reason for you to forfeit your earnest money deposit. The way to manage this risk is to sit down with your agent before you write your offer and discuss deposit refund, contingency and objection period guidelines. Make sure you ask every question you have and fully understand the guidelines and timelines, as you move through the phases of offer; counter-offer(s), if any; and contract acceptance.

Then, when you do get into contract, work with your agent to get a clear understanding of when your contingencies and/or objection periods expire, and put these dates on your own calendar. Throughout the transaction, operate as though time is of the essence when it comes to obtaining inspections, responding to your loan officer’s documentation requests and the like, because it truly is of the essence.  Finally, make sure you are vigilant about requesting an extension of time for your contingency or objection period(s) if needed.

Your agent will undoubtedly help keep you reminded of what dates are coming up, but you are ultimately responsible for ensuring that you collect the information you need in the time you have to gather it and make a final decision on a given property without forfeiting your deposit funds.

Risk #6: The Risk of Getting a “Bad” Loan. Because the world of mortgage and finance is an area that causes many people fear and trepidation, the idea of getting a so-called ‘bad’ loan strikes fear into the heart of many a home buyer and refi-er.  What makes for a bad loan is different for different people. Depending on where your head is at, it could mean anything from a loan with a higher interest rate or fees than you could have gotten elsewhere to a tricky loan program that has big, bad surprises in years to come, à la balloon payments or scary payment adjustments.

The risk of getting a bad loan was much greater during the subprime era, when there were loads of low-down payment, adjustable loans with big prepayment penalties and skyrocketing interest-only payments.  These loans are largely extinct right now (though they might not be forever).  Fortunately, you have much more control than you might think over whether you wind up with a ‘bad’ loan.

Exercise that control by:
  • Working with a mortgage loan officer that your friends, family or colleagues refer you to - and rave about - rather than simply walking into some branch of some bank off the street or working with the shiniest, slickest someone who promises they can “trick” the banks into giving you a loan.
  • If you have a bank you like or love, consider obtaining a loan quote from them and one from your referred mortgage loan officer, then ask both loan officers to help you compare them.
  • Taking the most plain vanilla home loan product you can. It’s very difficult to be surprised with a basic 30-year fixed-rate mortgage, where the payment stays the same until it’s paid off. The more complexities you add in, the more potential for surprise you open yourself up to.
  • Reading and understanding every line of your good faith estimate - and aggressively asking every question you have in your head until you completely understand it.  Do the same with your loan documents at closing. In fact, I recommend asking your loan officer to make sure you can review your loan documents at least a day or so in advance of your appointment to sign them, so you two can walk through them together in an unhurried manner before you’re sitting at the closing table.
  • Understand that property taxes and insurance costs do vary over time. Talk with your real estate and mortgage pros to try to wrap your head around the future trajectories of these costs. It’s not overkill to work with a financial planner as you move into the home owner stage of your financial life.

Risk #7: The Risk of Being Duped.  Related to the fear of buying a lemon of a home, many a home buyer, seller and mortgage borrower has asked me some version of this question over the years: “How do I know they’re not lying to me?”  And for the word “they,” you can pretty much fill in the blank with “my agent,” “the other agent,” “the seller,” “the buyer,” “the mortgage broker,” “the inspector/contractor” - you name it.  There are several ways to assess and approach the risk of being duped in the course of a real estate transaction, no matter who you fear might be doing the duping.

First, recognize that most people are more likely to be honest than they are to lie, as a general rule. Does this mean no one has ever lied to a buyer or a borrower?  Of course not - but it does mean that the risk of you being lied to is actually far lower than the risks involved with failing to fully read the disclosures a seller or lender has provided, in my experience.  This is especially true when it comes to professionals who have their credibility and livelihoods on the line, and sellers, most of whom would rather over-disclose than be sued later.

Second, work with professionals who have been referred to you and vouched for by people you know: your friends, relatives, colleagues, or the other real estate professionals you already have and trust.

And finally, whenever possible, get a backup source of information - don’t rely 100% on one individual’s word, if you don’t have to. Get inspections to give you a fuller picture of the home’s condition, beyond what the seller says.  Pull the home’s file with the city building department to learn more about how it’s been modified over time, if your contract and the real estate law of your area allows. Talk to the neighbors about their experience of the neighborhood - they’re often more than happy to share. Your agent can tell you what is and isn’t allowed under your contract.

All:  What real estate risks do you worry about?  How do you actively manage and minimize them?
All: You should follow Trulia and Tara on Facebook!     


Comments

By Jeri Creson,  Thu Nov 8 2012, 10:53
These are all risks that are very real, however, we have come a long, long way from the place where any of these should "sneak up you". We are in an information age like none other. There is time and place, and the offering of virtually any type of inspection you might desire. Comparables a-plenty... Loan disclosures and the care taken to not appear to be playing slight of hand tricks in mortgages have improved so dramatically, that if you get a bad loan, you're probably looking for one on purpose. Agents can be checked out - read our reviews - Google us. We can't break a nail without somebody writing something about it… and that's a good thing for consumer protection. Do your due diligence. Don't expect your agent to do it for you - he or she "should" guide you, and I certainly provide more information…good, solid, both positive and negative information… to my clients than they could ever imagine - but don't count on that. Consumers are more empowered than ever before in history to make a good decision and investment in real estate. It's a very good time to buy real estate. Perhaps the "least risky" time of all times, historically speaking.
By Alberto Osorio,  Thu Nov 8 2012, 11:27
I agree Jeri, I believe this is one of the best times to purchase or sell since it really is a good time for both buyers and sellers. Sellers have the benefit of the lack of inventory to get their homes sold quickly and for full asking price if not higher. Buyers have the benefit of taking advantage of historically rock bottom interest rates and home prices. Here in the SF Bay Area and surrounding areas I'm helping both buyers and sellers to take advantage of getting into the market instead of paying the elevated rents that we're seeing due to the shortage of invetory while also helping my clients that are looking to sell by getting them out of their house and on to their next one in a timely manner which is important since most clients I've worked with would rather not have to keep their homes open to potential buyers while it's on the market :) All in all, only you know when the right time is for you and your family however, feel free to reach out with any questions, comments, or concerns!

Alberto Osorio, REALTOR
925-658-8632
http://www.osoriorealestate.com
By Helen Oliveri,  Thu Nov 8 2012, 12:00
Great post, Tara.
By Pbalutis,  Thu Nov 8 2012, 12:11
Number 4 should include a professional Home Inspector, before all the other inspectors. Very suprised at you for not mentioning this as it is nearly pro forma around the country. The Home Inspector will then advise whether you need all the others tradesmen, saving you money in the long run and moving the sale along more quickly.
By SBoring515,  Thu Nov 8 2012, 12:26
The post doesn't go far enough. How about property that is represented to be owned by the seller (a single person) and it is ultimately found out that it was the subject of an estate that was being contested and the fact concealed during the purchase process. Think it can't happen to you; think again. Problem is we can't get anyone to do anything about it!!!!
By SBoring515,  Thu Nov 8 2012, 12:27
The post doesn't go far enough. How about property that is represented to be owned by the seller (a single person) and it is ultimately found out that it was the subject of an estate that was being contested and the fact concealed during the purchase process. Think it can't happen to you; think again. Problem is we can't get anyone to do anything about it!!!!
By John MacArthur,  Thu Nov 8 2012, 13:07
SBoring515, yes that does happen. The buyer is free to walk away. The contract for sale is voidable. If you need further information, contact me at macarthurgroup@gmail.com no charge, just free information.
By nadia.nxn30,  Thu Nov 8 2012, 13:22
I am trying to buy house here in north carolina ever since the summer. I waited on a short sale with an agent who said the bank has two offers; one is mine. Today, I'm informed by the agent that the bank accepted the other offer, however, the agent did not inform me about counter-offering. I asked what was the final selling price. The agent did not know. I am in the process of thinking about switching agents. Any comments or suggestions. I'm new to this game.
By Joanne Bernardini,  Thu Nov 8 2012, 13:26
Great reading for any home buyer! I ALWAYS mark the calendar with the expiration dates of contingencies and request extensions if needed. Most people don't realize the importance of that one step in keeping a contract valid and protecting deposit money!
By Sheretta Watson,  Thu Nov 8 2012, 13:38
If you sell a home on a short sell can u buy another home soon after or while it is still waiting to be sold
By Pauline Raftery,  Thu Nov 8 2012, 15:33
They didn't mention if you buy rental properties to earn rent in your retirement and then have the tenants not pay and the houses being constantly trashed and causing thousands of dollars in damage to steal a few dollars worth of copper piping. Don't the police ever do anything about these criminals? I purchased eight houses in the Kansas City MO area and have had constant problems with criminals braking into my houses and tenants not paying their rent. And now I am left with thousands of dollars in debt and no rental income in my old age. It has turned into a nightmare!!!
By Nina,  Thu Nov 8 2012, 19:34
The prices in LA are way too high compared to the amount that people really can afford! It is not reality! The same thing is happening again like 2008. The government are hiding this mountain of defaulted homes! ! People cannot really afford the mortgage payments and even though there are 25 buyers to each property having bidding wars, it doesnt mean that foreclosures arent happening....there are now MORE foreclosures, however the government has legislation to let that out onto the market place! The banks are also holding onto these properties hoping they will go up eventually & make a killer on them....wt everyone nice loans that cost regular people a fortune! Imagine how much money they are really making if you do the maths..every month they are minting it! .The economy cannot survive on the borrowed money of this housing fantasy that so many have. Next time, the crash will come down even harder wt vengance a second time & bite even more! Borrowing money is the whole reason the US/europe has gone on an out of control spiral! The US federal reserve just pumped billions (50$) that it itself has borrowed to flood into the housing loans....though this is again BORROWED money that only the happy bankers are making good money on from commision! Apart from that it will not bring America out of thiis recession...if anything, it will ruin many.
By Ronald,  Thu Nov 8 2012, 20:42
Pauline Raftery. I know what you are going through. If you want or need help please call me at this number so we can talk. 603-289-7714
By Mary King,  Fri Nov 9 2012, 01:12
Another great post, thanks. I agree with those who emphasise the import of a home inspection, it goes without saying, but in my experience 2 other participants are critical to making the process as stress free as possible: the right attorney And the right agent. Still I see buyers and sellers picking either one because they're a friend not due to their competance. This is not like buying candy, realize the import of this transaction.
By wilfredbechardjr,  Fri Nov 9 2012, 02:00
I very strongly reccomend all buyers who ARE INTERESTED IN BUYING A HOME AND WANT AN INSPECTION DONE TO NOT USE THE INSPECTION TEAM THE REALATOR SUGGEST, CAUSE MANY VHOOSE INSPECTION TEAMS THJAT WILL GIVE A GOOD REPORT JUST TO SELL THE HOUSE. gO OUT AND GET YOUR OWNINSPECTION TEAM THAT YOU YOURSELF KNOW. gOOD lUCK ALL
By jimgibbons,  Fri Nov 9 2012, 03:15
Always check out the HOA restrictions. They (HOAs) are ofen nightmares - managed by persons who are control freaks, or the neighborhood is full of control freaks.
By Taxman902,  Fri Nov 9 2012, 05:27
it would be nice if realtor comments would also be representative from a sellers viewpoint. There are a lot of sellers who invested in their homes with substantial downpayments and are now facing selling their homes at prices that take away their initial investments. I never hear about what sellers can do to protect their investments. Realtors should have an answer to this as they are just as responsible for the housing market crash. They are the ones that have brokered the deals to unqualified and under-qualified buyers that led us to where we are.
By Kathleen Salcedo,  Fri Nov 9 2012, 05:27
Another item to consider is the timely presentation of documents. For instance termite inspection in CA requires licensed companies to inspect, present work needed, then reinspect after work is completed. Often the report is presented at the beginning of escrow, then notice of work completed presented the day you sign closing papers. If there is a flaw (the seller does the work, not the termite co.!), the buyer doesn't know about until it is too late to object!

My point is that all documents should be available and gone over thoroughly by the buyer and their agent well before closing. That way any problems can be addressed, and the buyer won't be forced to sign off on paperwork that is contrary their best interests.
By Robert Dayton,  Fri Nov 9 2012, 11:22
Use a professional realtor to help you buy or sell a house. Someone that you check references on and has a track record and experience, not your cousin or a friend! This will help you more than anything else because these people have already assembled a team that will help you analyze any deal and check title, plat, utility easements, construction and all of the other mine fields associated with real estate transactions.
By Cynthia Howard,  Fri Nov 9 2012, 11:38
Please hire your own Home Inspector. The real Estate company used one of there own and we ended up with a nightmare lemon house. Please pray for me...
By emma morrison,  Fri Nov 9 2012, 17:28
By emma726, Fri. Nov. 9 2012
I bought a condo in Aug. and have had HOA problems almost from day one after my new tenant moved in. his car was towed, I called a locksmith for the mailbox. bought 2 gate keys from the liason, bought 2 remotes to open the gate to drive in and a parking permit, all at seperate times from the liason. then paid a plumber $900 for backed up sewer pipes and got a $169 water bill for one month. and on and on.........Talk about an HOA from helllll. But they win!! I want out!
By Kimberly,  Fri Nov 9 2012, 19:15
The lesson I learned was to make sure you get the Disclosures paperwork BEFORE you dole out the money for those home inspections! You might find out through the disclosures that this house has something on your deal-breaker list, like Mello-Roos taxes your realtor swore were not applicable to the house you were buying and the county tax office was so busy they didn't really listen and just said they didn't see anything that said "Mello-Roos" on the tax bill (otherwise known and direct assessment taxes not based on the home's value) but there it was in the Disclosure paperwork that I was given to look over at the house WHILE the home inspection was going on that I'd just written a check for. GRRRRRR. I lost the money for the appraisal and home inspection I'd just paid for, $795 worth, and ended up having to walk away from escrow with my heart broken because I'd loved the home. My realtor could've given a crap and was basically just upset because she "lost the sale." To add insult to injury, she had the nerve to stand me up a week later when we had another home viewing appointment. All of a sudden she was "too busy" to continue showing me homes. I wanted to slap her. Especially because I'd found out that she had the Disclosures 3 days before the inspections but just didn't bother to tell me because it'd be more convenient for HER to just bring them to the inspection. I tell any friends of mine now who put offers on homes that they need to insist on the Disclosure paperwork before shelling out ANY money whatsoever. Lesson learned.
By Mwagner59,  Fri Nov 9 2012, 22:09
I had a very experienced professional realtor working with me to sell my house and he said that you can not always use the comps in the neighborhood to price your home. He told me that my home did not compare with any of the comps in my area and he was sure he could get what I wanted for it. He had sold many homes in the area and was a top realtor in sales(even in this market). He told me to make a couple of minor changes and then we would list it. However, he unexpectedly passed away two weeks later. This was a year and a half ago and I have not listed my home with any one else because, so far no one has had the same attitude he had or the reputation to back it up. And I do not need to sell, so, I have just decided to wait. I am not selling my home for less than I feel it should be worth, due to foreclosures and shortsales that have brought the true value down. Most of those homes need a lot of work or at least have not been maintained, certainly not recently updated and move in ready.
By Patteann,  Sun Nov 11 2012, 05:14
This comment is for emma morrison or whomever can assist me regarding HOA.s in Texas. The Port of Houston is installing a container project in Galveston Bay beside 411 properties (homes, condos, Houston Yacht Club), with 9 cranes in existance, 21 at the end of completion. Ships arrive from international waters 24/7, loading and unloading "whatever" and the noise, pollution, etc is unreal. I personally have lived in my condo 22+ years, which is almost paid for. Due to Hurricane IKE, it was so damaged, it is now full of mold, mildew, roof leaks during heavy rains, and the HOA is a nightmare dealing with any issue. There are 3 bldgs, 24 units, and more than half are leased to tenants who don't seem to care enough to even pick up phone books which were delivered over 3 weeks ago, left at their front door. Bottom line, due to the condition of my condo, I am unable to sell or lease it nor do I expect anyone else to live in this noisy, polluted neighborhood, It is effecting my health, peace of mind and sanity. Obviously I need a place to live and can't afford 2 roofs over my head. Any suggestions? I've recently posted a previous note regarding this same issue, so if this is not the proper place to address my question, please advise. Thanks TRULIA for your most valuable and informative website. God Bless America and all the Veterans who served and dedicated their time to this great country! Patricia in Texas
By Jensgarden09,  Sun Nov 11 2012, 06:32
Under contract on a forclosure for 7 months with no settlement date in sight only extentions while the house is falling apart and is no longer in the same condition when we wrote the contract. The house has been empty for 3 years and you would think that Fanny Mae would want to clear it off their books quickly but you can't talk to anyone and can't get any info about what the delay is. It defies and logic.. They don't care how disruptive it is to the buyers that have to sell their old house and are living with packed boxes ready to go. No wonder the economy is slow to recover because of stupid red tape.
By Kiki,  Mon Nov 12 2012, 08:48
Tara, you are one of the smarter ones among the used house salesmen. Don't you know the difference between a house and a home ?

Also, there are only 3 MAIN rules that pose risks these days:

1. Sellers' GREED
2. Used house salesmen GREED
3. Buyers' STUPIDITY
By Barrington Palmer,  Mon Nov 12 2012, 09:51
Good job as usual,Tara, this is great reading.
By Mark Acantilado,  Tue Nov 13 2012, 02:10
Risks are always everywhere. No matter what you decide on, risk is there. Whether you over or underestimated it. Even when you have taken the right decision, risk is still there.

The best thing that an individual do is to overcome the risk, manage the risk and keep learning from mistakes. Good post Tara. :)
By Carol Darrow,  Wed Nov 14 2012, 09:21
Foeclosure's are down and short sales are a monolopy. Prices are on a rise because of lack of inventory. Buyers are feeling good about purchasing homes in this market. It's a great time to buy and everyone knows it.
By Sandra Connelly,  Wed Nov 14 2012, 11:21
It certainly is a great time to buy. If you price your home well with an experienced Realtor and stage it so it competes with other homes for sale, it can sell pretty quickly; and you get a great bargain for your next home with these marvelous interest rates! We're probably at rock bottom rates now, but prices will be going up, due to lack of inventory, so, NOW is the right time!
By Barbara A. Wild,  Thu Nov 15 2012, 15:59
I have had my house on the market in NY for six months and there have been only six houses sold in a year in our town. The house dropped from 388,000 to 229,000 and the realtor wants to drop it more. There have been NO people at all come through. We have inventory galore and no one is buying anything. What to do? The house is paid for, but cant afford the taxes anymore.
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You have a very good site, well constructed and very interesting i have
bookmarked you hopefully you keep posting new stuff.

http://chexsystemsremovals.com/chexsystems-banks
 
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