Short Sale Case Study – A Family Kicks Starts Finances

Name – Edward and Anna from Elgin, IL
Occupation – Manager and teacher
Income – $75,000 combined
Total Debt Load – $125K mortgage 1 + $20K HELOC = $145K

Do you qualify for a short sale?  Find out here:
Qualifications for a short sale

Reason for Selling:
After being downsized at his company, Edward found himself unexpectedly unemployed. As the  family’s main breadwinner, the family counted on his paycheck for stability. He was able to find a new job quickly, but he was disappointed in the large pay cut. With the reduced income and bills piling up, the family quickly drained their emergency fund. Although Edward was trying to find a better paying position, it was going to take longer than they expected.  Edward and Anna realized the mortgage was now out of their comfort range to afford.

First, they talked with their lender and were able to get a temporary reprieve on their payments with a loan modification.  However, the loan modification ran out after 6 months’ time and the regular mortgage payment was reinstated.  Edward had not found better employment and they were no closer to affording their mortgage.  Edward and Anna decided to look into a short sale and remove their mortgage burden.

Next steps: a pre-screening and a market analysis
Talking with them at their kitchen table on a quiet Tuesday night, we knew right away we could assist them.  When Edward and Anna contacted our team, we knew they had exhausted all efforts to save their home.  They had just hit a rough spot along the road of life, as so often happens.  First, we looked over their mortgages and expenses.  Then we looked at current market values for homes in the area.

A comparative market analysis for the home indicated a market value of $120K, which was less than what was owed. This property was underwater, meaning they owed more than what it was worth.  The home was in fair condition and would be sold as-is.  Edward and Anna were relieved to find out that they did not need to make any repairs or fixes on their home before the short sale. They paid no money out of pocket for the short sale. Our team listed the home at $119,900.  A buyer made an offer of $110K, which the bank countered to $115K.  The buyer agreed and the short sale was processed.

Results:
Under the short sale process, the lender also took care of the attorney fees, closing costs, title fees, and agent commissions.  Using a program called Home Affordable Foreclosure Alternatives, or HAFA program, Edward and Anna could receive a closing cost credit of $10,000 because they were owner occupants with a clear hardship – loss of income. They also realized a short sale would impact their credit score for a much briefer time period than a foreclosure.  The family decided it was the best strategy for them and completed the short sale.

Now:
After short selling their home, Edward and Anna made a difficult decision to move in temporarily with family locally in Elgin, IL, until they could sort out their next steps.  Edward continued to look for work.  Their patience and persistence paid off.  Five months after the short sale was completed, Edward found a better paying position with a new company in the area.  They  are saving up their money, rebuilding their emergency fund, and plan on buying another home soon.

 

Did you know?  
In addition to short sales, Fox Valley Short Sales offers full broker service for regular and distressed listings, for all buyers and home sellers, rentals, as well as investors in residential properties across the northern Illinois and Chicago region. All team members are trained to coordinate short sales effectively and retain the full skills and expertise of fully licensed Realtors®, including access to the resources of the local Illinois MLS database.

For more information and details on short sales and more, please contact Jennifer Kinzle, 630-854-4360. Email me direct  jkinzle73@gmail.com to get on track for 2016.

Contact me:

Direct/Text:  (630) 854-4360
Facebook: Fox Valley Homes – Jennifer Kinzle, Broker
Fox Valley Investors Group: Fox Valley Investor Group – on Facebook
Email: jkinzle73@gmail.com
Twitter: @jkinzle
Website:  www.FoxValleyShortSales.com
Instagram: @jkinzle
MeetUp: Fox Valley Investors MeetUp Group

 

Charles Rutenberg Realty of Illinois
1733 Park St, #150
Naperville, IL 60563
LIC 481.010.165

Homeowners vs. Investors

 

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“I’ve never bought a home.  Should I look at my first home as an investment?”

This question came up recently at my Fox Valley Investors Group MeetUp.  (details: Fox Valley Investors  ) .  Our group is open to everyone and we get folks of all experience levels, backgrounds and ages when we do our on-site property evaluations.  It was great how this person took the first step into a broader world of real estate by coming out to the property evaluation, and didn’t have any expectations about investing in property.

I took the liberty of explaining how a personal home is not the same as an investment property. Everyone needs a roof over their head,  but a property investor has a few extra.  The difference between investing and home ownership is huge.  Here’s my take:

99 problems plus your own home
A homeowner has one roof, one furnace, one set of pipes and one water heater to worry about.  An investor typically has their own home plus several others on their worry list.  Investors inherit new problems from other locations such as running background checks, deciding on lease terms, fixing broken furnaces in winter,  leaky roofs, calls in the middle of the night on plumbing and weekends, too.  Working a regular 40 hour/week job?  Consider how you’ll handle those extra fixes and issues on your nights and weekends year round.

“But I love this house!” said no investor ever.
Investors don’t love their investments, they love with the profits and checks that come along with a successful business.  Falling in love with a house is not good for business and can undermine a sound business plan. However, falling in love with a house and envisioning cozy family holidays, Super Bowl parties with friends, a big garden, relaxing nights or a remodeled kitchen,  are the exact right reasons to make a purchase to enjoy for years to come.

X marks the spot
Homeowners live in their homes to enjoy them, to maintain them, and to do with as they please.   They might want a home close to work, by a nature preserve, something without stairs, or with a huge back yard.  Their personal preferences trump the investor card every time.  That’s important because building your life in a new home can be a great perk of home ownership. Often people move to a single family home after years of renting and paying a landlord.  The freedom to own your walls, ceiling, garage and basement without needing to share it can be alluring.  I’ve had new homeowners so excited to have a laundry room that they install the washer and dryer before unpacking a single box on Day One!  And if you’re ready to paint the walls in Fired Up Orange, now you can go for it!

Make it personal
Knowing the difference between a detached, professional business approach to buying an investment and falling in love with a white picket fence is important to understanding your first home purchase.

So go and search out those dream homes on the internet.  It’s an adventure to boldly walk through a front door of a house for sale to see if it is right for you!  Will it be as great in person as it looked online?  Maybe.  But one thing is for certain: your first home will be a great “investment”.  Absolutely, yes!  As long as you’re loving the roof over your head and the lifestyle it offers, you’ll be ahead every time you pay the mortgage.

So, what’s your motivation for buying a home?  Interested in investing in properties?  Have you tried a house hack like buying a fixer upper to live in as you fix it?  Find out if a house hack is right for you!  Attend our next meet up and learn from the local property pro’s.  Join us here:  Fox Valley Investors

Free Property Report
Property markets change every 90 days!  But folks sell homes all year long.  Take the first step and get a free market report by going here:
Free Property Report

 
Questions?  Contact me:
Jennifer Kinzle, e-PRO Broker
Charles Rutenberg Realty of Illinois
Email: Jkinzle73@gmail.com
Twitter: @Jkinzle
Web: St. Charles Fox Valley Homes

 

 

Real Estate Branding Nightmares

Cobb & Webb Realty

 

Spider Free Homes

 

Laughing Coffin Real Estate

 

No Vacancy Real Estate

 

Reaper Realty

Bloodsucker Real Estate

 

Warlock Realty

 

Last Listing Realty

 

Two Story Terrors

 

Helen Back Real Estate

 

Scare & Crowe Realty

 

Deadbolt Realty

 

Coffin Estates Realty

 

Breaking Dawn Real Estate

 

Stake-Free Homes

 

 

Two Mummies and a House Realty

 

 

 

New Crypts Realty

 

Haunted Homes Realty

 

Headless Homes, Inc.

 

 

 

(*Disclaimer: all names listed are pure fiction and any relation to a real business name, living or undead, is completely unintentional.  Happy Halloween!)

HARP your way to savings!

Elgin Fox Valley, IL – Don’t throw away free money!   Many of my clients have enjoyed much lower mortgage payments by simply obtaining a new lower interest rate via the HARP program.  If you are a homeowner who hasn’t refinanced their mortgage, there is still time to save.  The federally subsidized HARP program is still in effect and saving homeowners money now through December 31, 2015. Restrictions apply.   See the link below for details.

http://www.makinghomeaffordable.gov/programs/lower-rates/Pages/harp.aspx

Eligibility:

“You may be eligible for HARP if you meet all of the following criteria:

• The mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.
• The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
• The mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.
• The current loan-to-value (LTV) ratio must be greater than 80%.
• The borrower must be current on the mortgage at the time of the refinance, with a good payment history in the past 12 months.

*Eligibility criteria are for guidance only. Contact your mortgage servicer to see if you are eligible for HARP.”

 

Check with your local mortgage provider for more details.  Freddie and Fannie Mae loans only.

 

Housing Market Improves in South Elgin

South Elgin, IL – Recent reports from the MLS database indicated that the property market is on an upward streak.

Homes are going under contract fast!  We are going under contract in just over 2 months’ time from the date a listing begins.

South Elgin property prices are on the upswing this spring and summer!  This reflects an average 14% increase in sales prices as compared to the same time last year.

 

With average market time (Days On Market) dropping to under 90 days’ time, inventory is tight and homeowners are getting fast offers for top dollar.

 

Thinking of getting a market analysis on your home?  Contact me for details on getting one started.

Or, check out local homes for sale with a new mobile app, Midwest Homes by clicking here: http://t.ikenex.com/?k=n0t
Note: Use 240766 for agent ID to log in.  In case the setup gets interrupted, simply tap the link above again.

Eyes only-home inspection reports and radon concerns

Elgin Fox Valley, IL – Market Watch offers a buyer beware article on home inspectors.

http://www.marketwatch.com/story/10-things-home-inspectors-wont-tell-you-2014-05-30?link=MW_story_popular

This article highlights that a few reasons why you should get a licensed, professional home inspector to conduct your home inspection, but it is still buyer beware!  Few purchases can be as complicated as buying a home.  Let’s face it, anything that takes 8 weeks to finally close on is complicated.  The process may be tricky but the home inspection is plain.

You might not want to read an  extensive report on your new property.  But read it anyway!  The full report from your certified ASHI home inspector may be boring, but is very valuable to understand the general condition and issues with the property that you may need to address.  Remember, your broker is not liable for defects in the house, the homeowner is.  Get your full money’s worth and ask questions, and follow up questions if need be.  Some issues like plumbing or foundation cracks, are larger problems.  Others like broken outlets or a missing railing can be fixed easily.  Keep in mind that once an issue is found, it cannot be “unfound” and the next buyer who wants to inspect the home will see the same issue(s) come up again unless it is fixed.  It is in the best interest of the home seller to address any issues right away to ensure a smooth transaction.

Also, be sure to use your own inspector or get referrals to one from a trusted source.  Your real estate broker can offer local suggestions, but they are prohibited from offering one preferred inspector for you to use.

For example, not only did we hire a home inspector for our own home purchase, our inspector indicated our Elgin Fox Valley area has documented radon issues and to consider a separate radon test, as the house never had one done.  We found a radon testing company and set up the test.  Indeed, after the results of the radon test were compiled, the  stunning off-the-chart results almost caused the deal to fall apart.  However, after a bit of negotiation, an agreement to pay for the radon mitigation was added on the seller’s side and the deal was completed.

 

 

 

Interest rates outgrow their skinny jeans

Saint Charles, IL – Mortgage rates are still under the label of Hot Topic  in early 2014 and it is not too late to lock in a low rate.  According to the Huffington Post, http://www.huffingtonpost.com/realtorcom/how-rising-mortgage-rates_b_4719700.html, mortgage rates are expected to rise to 5-5.5% by the end of the year.  This is a modest increase, not exactly a fattening up of rates, but the skinny jeans are getting uncomfortable for interest rates this year.

Watching the rates tick slowly back up will be a popular tipping point for a lot of home buyers this year, across Elgin and the Fox Valley area as well as the rest of the nation.  Regardless of whether your home loan comes from Cherry Creek, Mortgage One or Chase, home buyers still need to be pre-approved before house hunting and should be comfortable with their lender and loan amount.

Get the mortgage loan process moving today!

• Check your credit rate and straighten out any inconsistencies.  Visit a website like Credit Karma.com https://www.creditkarma.com/credit-report-card to get a free report or do a Google search to get a list of credit report companies.
• Shop around for a mortgage lender in your area who is in experienced in residential mortgage loans.  The longer they’ve been in business, the more likely it is that your loan officer has seen it all and can help evaluate the best loan products for your individual needs.
• Lock in your interest rate as rates are very likely to climb as the Federal Reserve Bank is slated to reduce the economic stimulus program in 2014.  There is no better hedge against rising rates than to lock in a low one today.
• Make sure your loan application paperwork is in order, such as paycheck stubs, bank statements, tax returns and more.  Your lender will walk you through exactly what you need to attain a pre-approval, be aware that final documents may require additional proof of income or other information.
• Skip the exotic loans.  The 1 year ARMS,5 year ARMS or mortgages that pay interest only are not the best option for a long term mortgage.  The standard, plain vanilla conventional loan is still the most enduring, most boring loan available and for good reason.  A 30 year loan means your payments stay the same from year 1 to year 5 to year 12 and so on.  Meanwhile, taxes and your pay rate may change, making your locked in mortgage rate (and monthly payment) consistent and possibly easier to pay as you go forward.
• Remember the 90 day window.  Mortgage lenders like to see a steady income and no large chunks of cash inbound or vanishing from your accounts.  If you are going to be accepting a gift for a down payment from a family member, move it now and let it sit for 90 days’ in one account.  Also, do not open any new lines of credit once you’ve applied for your mortgage loan.  Adding additional credit cards will skew your ratios that the lender takes into consideration for the amount you can qualify for on a home loan.
• Don’t panic.  Protect yourself with a locked in rate.  This way, if rates creep upward while you’re in the middle of the home buying process, your locked in rate will offer shelter and not price you out of the housing market overnight.  A small rate increase won’t affect the monthly payment too much.  But waiting until rates rise a full percentage point from 4.5%  to 5.5% will impact your buying power.  Don’t wait any longer if you’re ready to make a move.  This is the time to do it.

If you need more information and don’t have a mortgage lender, contact a local licensed buyer’s agent and ask for their list of referrals.  There is no obligation and it can be a great place to start.

Let me help you find your next home in the beautiful Fox Valley area!  Call or email me today:
Jennifer@ElginFoxValley.com
630-854-4360

What’s new in Elgin – 1000 Pinehurst

Elgin, Il – Just past the halfway point of January, the new home builders begin dusting off their models and updating their MLS listings with their brokers. Although there were several new listings today for the new builds, this property at 1000 Pinehurst is worthy of a closer look:

http://www.realtor.com/realestateandhomes-detail/1000-Pinehurst-Ct_Elgin_IL_60124_M86869-43379

Priced at $322K, this like-new home competes with the larger and more expensive properties on the market with its gorgeous and airy layout  and luxury touches throughout.  Offering a modest 3 bedrooms, 3 baths and two car garage, this home offers a highly sought after single level ranch floor plan. The master bedroom has volume ceilings and graceful entryways that are worthy of a photo shoot in Better Homes and Gardens.  Beautiful trim work combined with an effortless paint palette and move in ready condition make this ranch home a wonderful find in the Elgin Fox Valley’s late winter housing market.

We are setting up appointments now to homeowners who are ready to make the move this spring to a new home.  Call or email today for a free comparative market analysis on your home’s value.

Jennifer@ElginFoxValley.com
630-854-4360

Tennis, anyone?

Elgin, IL – If you love the game of tennis, why not include a private tennis court on your next home?  The homeowners at this lovely property in Elgin did just that and now you can too!

http://www.realtor.com/realestateandhomes-detail/300-Greenfeather-Ln_Elgin_IL_60120_M76244-79498?row=4

Set in Sherwood Oaks, the home at 300 Greenfeather in Elgi,n offers 6,000 square feet of living space, updated features, room for multilevel living and entertaining as well as a private tennis court.  Built in 1992, this home has been redone from top to bottom and must be seen in person to be fully appreciated.  Five bedrooms and four and half baths ensure plenty of room for everyone plus room for six cars.  Fireplaces add warmth, skylights brighten the rooms, natural stone tiles create smooth lines and rich hardwood floors beautifully criss-cross the length of home.

All this in Elgin?  Yes!

Priced under $600K.

Jennifer@ElginFoxValley.com

Land surveys and your property

As a home buyer in the Elgin Fox Valley area, you’ve probably already been pre-screened for your mortgage.  How about pre-screening your lot and property?  Few banks today require a land survey prior to purchasing a home, however, it is still an important element of the purchase process.  Finding out if there are encroachments on your property and or any issues with property boundary lines or corners are two major reasons to consider getting a survey done.  In addition, a land survey can identify local regulations that may affect future plans to divide a parcel and/or resale value.

What are land surveys?

Land surveys are topographic drawings of landscape features used for mapping.  A professional surveyor maps and verifies the boundary lines and property improvements for a specific parcel of land.  This can include the exact placement of such things as power lines, fence lines, streets, and the locations of existing structures on the property including homes, detached sheds and garages.

Who needs a land survey?

All builders are required to have surveys done and filed for each parcel and lot number that they build on.  Re-surveyed properties are not required for most banks, however, running a fresh survey can help reinstate the property lines as well as establish ownership should something have grown up or into a property over subsequent years.  Clients who have purchased homes with old growth trees or aged fences may be surprised to learn such things have simply encroached on their land, shifting boundary lines over time and flowing into the landscape.  It is always better to be prepared with more knowledge than finding out later you’re responsible for trees you thought weren’t on your property and the costs for fixing damages caused by it may find you unprepared.

Fees for surveys

There is a wide range of fees for a land survey, so be sure to call around.  Some are as low as $250, all the way up to $500.  An acre or more to survey will often cost more.  In addition, fees will cover the new survey documentation, as well as a professionally licensed person to come out to survey the land and record it.  Be sure to check for a fully credentialed pro who is insured and certified.  Some places like Angie’s List can offer a list of land surveyors who are pre-screened by fellow members.

Join the conversation in the Fox Valley today!  Email me at Jennifer@ElginFoxValley.com