Forbes Magazine made some good predictions for Atlanta home builders and residents. While other cities like Las Vegas and Phoenix are expected to see home prices decrease by up to 50%, Atlanta is predicted to see significant increases as early as 2009. Although Forbes mentions the number of Atlanta foreclosures, our continued steady job growth rate promises an end to our housing slump. In fact, next year home starts are expected to jump up by 32.5% for single family homes around the metro Atlanta area. Multi-family home prices are expected to rise by as much as 18.4% and job growth will remain around the steady 2% yearly increase that has kept Atlanta afloat and the envy of the nation. We are placed number nine in the group of ten “lucky cities” that are predicted to experience long term recovery that will begin next year. May 12, 2009, my personal opinion is that we are at the bottom of the real estate decline in the local market. The best foreclosure inventory is disappearing, regular homeowners are seeing better sales. In addition to the $8,000 federal tax credit, Georgia has added $1,800.







Buyer Brokerage




Before 1994 all Georgia Real Estate Agents represented the Sellers. Every agent negotiated every contract with the Seller’s best interests foremost. In 1994 the real estate laws in Georgia changed to allow Buyer Brokerage, giving buyers the right to choose legal representation. In July, 2000, the Georgia Real Estate Laws changed again. A Real Estate Agent is prohibited from representing a buyer as a client without first entering into a written agreement. You will have the advantage with Sharon as your Buyer's Agent. Sharon will be your personal advocate in the purchase of your new home. She is completely committed to protecting your best interests; working solely for you in finding, purchasing, financing, and closing the transaction. Sharon has no legal responsibility to the Seller or the Seller's Agent, so she is better able to protect your privacy and answer your questions completely.










New Home Buyer






If you have decided to purchase a new home, you need to have Buyer Representation. The on-site agent represents the builder and/or developer. Frequently, the on-site agents know their job well and things go relatively smoothly. However, that is not always the case. (The stories you see on the news are often about new home buyers that did not have Buyer Representation.) Outlined below are three situations where Sharon was able to assist Buyers that had chosen her to represent them.

1)  As a Buyers Agent, Sharon verified the promised completion date with the on-site agent just one week prior to the scheduled closing date. The home was not ready on the Friday as promised. It was so far from completion that the county would not issue a Certificate of Occupancy. Sharon's Buyers had to vacate their current residence. Sharon was able to negotiate with the Builder for the buyers to move their belongings into the garage and basement of the new home. Furthermore, the builder reimbursed Sharon's Buyers for hotel and eating expenses until the closing day.

2)   Another of Sharon’s buyers selected a home with a deck built off the back of the house. Beyond this deck was a steep slope and Sharon’s Buyer had concerns. This Buyer felt that the deck was not secure. However, a meeting with the Builder and the subdivision Superintendent did not have the desired outcome. The Builder and Superintendnety stated that the deck was very secure and offered to fix the deck later should it turn out they were wrong. Sharon consulted a structural engineer who verified that the buyers' concerns were sound and valid. Confronted by Sharons demands that her client be treated fairly, the Builder repaired the deck prior to closing.  

3)  Sharon's new home Buyer bought a pre-sale. We chose carpet, paint, cabinets, etc. and put down the large builder deposit (not earnest money). Four months into the home building process and just three weeks before closing, the Buyer decided to quit his job and move to Tennessee to become a Pastor. Sharon negotiated a full refund of his builder deposit.  Until the laws changed in January of 1994, all real estate agents in Georgia represented the Sellers. Now you, the Buyer, can have someone look out for your best interests. Buyer Representation is a right most experienced and educated Buyers choose. Interview Sharon today!!












 



Overview of the Buying Process






Step One--Talk with a Mortgage Lender.

Several types of companies offer loans to home buyers. Good service, competitive interest rates and low closing costs are important items to consider as you select your lender. Sharon believes that it is also important that you feel comfortable with the Loan Originator and Loan Processor, because these are the people who are going to guide you through the process and learn all of your personal financial details. By talking with a Mortgage Lender first, you are educated in your loan product choices. This way we can begin searching for your new home in the correct price range. Sharon is happy to offer you a list of Mortgage Lenders.

Step Two--Meet with Sharon

Sharon likes to begin the process by actually meeting with you at her office, located at 2855 Lawrenceville-Suwanee Road in the Horizon Village Shopping Center in Suwanee, just one mile east of Interstate 85 at Exit 111. It usually takes about one hour for Sharon to help you clarify your goals, chart a course to meet your goals, and search the Realtor databases for homes to go look at.

Step Three--Locate your home

Your search begins with an extensive look into the homes currently on the market including For Sale By Owners. If Sharon’s daily search of new listings does not locate your new home, rest assured she has other sources for homes not on the market. Some agents make statements like: "All agents are pulling information on available homes from the same database." However, Sharon goes the extra mile for her clients. She helps you search for a home as she would search for her own home.

Step Four--Make the offer

Taking into account the recent comparable sales, the current real estate snapshot, and other factors, Sharon will consult with you and advise you on how to create an offer that will have the best chance of helping you reach your personal goals. Sharon will prepare that offer for you, while consistently looking out for your best interests.

Step Five--Negotiate the offer

There are several things to keep in mind during the negotiation process. Sharon is negotiating all the time and will give you her best advice. Almost everything is negotiable in a real estate contract. Sharon thinks outside the box to help you reach all of your goals. When all of the items have been agreed upon, Sharon reviews the final Purchase and Sale Agreement with you before your legal signature.

Step Six--Satisfy all contingencies, special stipulations, and terms of the contract.

This is an involved process with several deadlines that, when missed, can cause the Buyer to lose some rights. Sharon's experience can guide you through this process all of the way to a successful closing.

Step Seven--Walk Through

The day of closing or the day before, one more trip to the house to do a final walk-through is a wonderful idea.

Step Eight--Closing

In the state of Georgia "Closing" (where ownership of property is legally transferred from Seller to Buyer) usually occurs at an attorney's office. Sharon will assist you in locating a good attorney, finding the office, and having the paperwork completed correctly and in a timely manner.

However, on occasion circumstances demand a change from the ordinary. Once Sharon closed a home with a Lender in a hospital room with a new mother whose baby came early. Sharon is always willing to go the extra mile to make your home ownership dream come true.

Step Nine--Post-Closing

Sharon's service does not stop at closing. If there is an item that needs attention after closing Sharon is happy to work with you until the situation is resolved.










Closing costs and Pre-paids















Home Inspections






As an informed buyer you will probably elect to hire a Home Inspector to come to your new home. A home inspection gives you more detailed information about the house you have selected to purchase. A home inspection give you an impartial, physical evaluation of the overall condition of the home and items that need to be repaired or replaced. During a home inspection a qualified inspector takes an in-depth, unbiased look at your potential new home to:

You will receive a written report when the home inspection is complete. In this report the inspector provides a detailed synopsis on the condition of the structural components, exterior, roofing, plumbing, electrical, heating, insulation and ventilation, air conditioning, and interiors. Some inspectors give this report to you on site and some email them later that day or the next day. Listed below are some inspectors my buyers have been happy with:

M Earl Whatley
Nova Home Inspection Services
Direct 404-358-3783
novahis@bellsouth.net



Richard Smith
Calibre Home Inspections
rslsshemerdiak@windstream.net  
770-932-0932    


 Sharon has a book and can provide you with sample inspections for you to review before making your selection.









Costly Mistakes




Costly Mistakes






Buying a home is the single largest investment in many portfolios.  By educating yourself you will be able to avoid some of the most common mistakes.


#1    Buying the wrong house

For some people paying fair market price would be purchasing the wrong house.  For these buyers building immediate equity is an essential part of their short-term and/or long-term goals.  These buyers are often willing to purchase fixer-uppers.

However, most buyers do not benefit from purchasing fixer-uppers.  Unless you are well-versed in all area of home repair/improvement, a fixer-upper (and many foreclosures)  can be a money pit and home life can be less than pleasant.

Sharon will help you identify and clarify both your short-term and your long-term real estate goals and help you locate a property that fits your individual needs and desires.  Sharon will negotiate on your behalf the best price/terms/conditions on your chosen property.

#2    Paying the wrong price

How do you know what is a fair price and acceptable terms for a particular piece of property?  Some buyers fall in love with a particular house and overpay; some buyers lose their dream home because they offer too little and someone else is the successful bidder. 

Don't try to go it alone.  Sharon is a tough, educated, fair negotiator.  Sharon is skilled negotiating in this market with all types of people and situations.

#3    Surprises

There are several areas surprises can occur: survey, appraisals, title searches, closing costs, seller not complying with special stipulations, and many, many more.  Do you know which Home Buyer Warranty's cover roofs, or air conditioner replacements?  Do you know the warning signs for a failing septic system?  Do you know the pitfalls of polybultene plumbing, Louisiana Pacific siding, and flood plains?  Do you know how to track the time line of your loan from origination to processor to underwriter to the closing department to the attorney and back for a funding number? 

Sharon goes through the home buying/selling process with someone each month and knows what to look out for.  Sharon knows what questions to ask, when to ask them, and what answers to expect.  However, she is not an expert in any of these areas and you should consider consulting a professional any time you have a specific concern.

#4   Working with the wrong agent.

Real Estate transactions are among the most important financial transactions in your lifetime.   Take your time when selecting a real estate agent.  Interview, ask questions.  If you want to make your selling experience the best it can be, it is crucial that you select the best agent for you. 

Sharon is always willing to give you a no-obligation second (or third, etc.) opinion.    Sharon thinks outside the box and may have an innovative idea for you.













Credit Reports

You can order your credit report from any one, two or three of the major credit reporting companies:

Equifax
800-685-1111
www.equifax.com

Experian
888-397-3741
www.experian.com

TransUnion
800-888-4213
www.transunion.com














Mortgage Lenders






One of the very first steps is to select a Lender. Listed below are several Lenders I have successfully worked with.
 


Linda J. Stratton
Mortgage Consultant
Advantage Mortgage Partners, LLC
An Affiliate Of Wells Fargo Home Mortgage  
(770)329-4175 Tel
E-Fax 866-647-3854
linda.j.stratton@advantagemortgagepartners.com
www.ljstratton.com


Scott Jacobs
Branch Manager, Envoy Mortgage
Phone/FAX 770-556-1234
scott@7705561234.com
www.7705561234.com


 









 





Mortgage Types






Fixed-Rate Conventional Mortgage

A conventional loan is a loan made to a buyer by a commercial lender without a third-party participant, such as government agencies like Veterans Affairs (VA) or the Federal Housing Administration (FHA).  Fixed-rate conventional loans are typically paid off in equal monthly payments spread over 15 or 30 years.  The interest rate stays the same and the principal and interest payment remains constant throughout the life of the loan.

Adjustable-Rate Mortgage (ARM; also "variable rate")

The interest rate adjusts--monthly, every 6 months, or annually.  The adjustment is tied to a financial market index (such as one-year Treasury bills).  Most ARMs set a maximum adjustment (or "cap") on rates for each year and the life of the loan.

 FHA Loan

These are loans insured by the FHA (Federal Housing Administration).  This insurance increases lenders' willingness to provide loans to borrowers.  FHA charges an advance mortgage insurance premium (MIP) fee which is rolled into the loan, as well as a monthly mortgage insurance charge for all loans.  Additionally, there is a limit on the size of loans they will insure; this limit varies by county.  FHA loans are assumable if the buyers qualify.

VA Loan

Qualified veterans can take out loans up to a specific limit with no down payment.  VA-guaranteed loans are fully assumable if the buyers qualify.  VA charges a funding fee at the time of purchase of  2% - 3% of the loan.

Non-Conventional Loans

These loans are sometimes known as B, C, or D.  Non-conventional loans may be chosen by buyers that do not qualify for a conventional product.  Most non-conventional loans have both higher interest rates and a greater number of discount points.  Additionally, they often carry pre-payment penalties.  In todays economic climate these products are very difficult (sometimes impossible) to locate.


Jumbo Loans 

A Jumbo Loan, also called a non-conforming loan, is a mortgage with a loan amount greater than the conforming limit.  The conforming loan limit is set every January and is currently $417,000 .  The conforming loan lmit is the maximum loan size eligable for purchase by either Fannie Mae or Freddie Mac, who purchase the underlying securities from mortgage originators.  Jumbo loans are more expensive than conforming loan products.

Interest Only Mortgage  

The Interest Only Program was very popular and still is attractive to some purchasers, especially for second mortgages.  The payment is calculated by taking the loan amount, multiplied by the interest rate, divided by 12 (EX. $150,000 loan amount @ 6.5 = $9,750.50 / 12 = $812.50 per month payment.)  Low payments mean Buyers can qualify for more house.

The beauty of this product is that it allows you to control and accelerate the repayment of your mortgage.  Be careful!  Although mortgages can be fixed for a period of time, many of the products adjust monthly and carry pre-payment penalties.

 





Mortgage Calculator




Amortization(Years) =
Term (Years) =
Yearly Interest Rate (%) =
Principal Amount ($) =
Downpayment (%) =
Downpayment Required ($) =
Mortgage Principal ($) =
Monthly Payment ($) =














First Time Home Buyers






Taxes

If you are a first time home buyer (defination--have not owned a home for the last 3 years) and you purchase a home before December 1, 2009, there are tax credits you can claim on both your federal and state tax returns.  The Federal credit is up to $8,000 and the State credit is up to $1,800.

Additionally,  the interest on your mortgage, your closing costs, property taxes, and many other expenses are tax deductible.   You will need to consult with a tax advisor to learn the particulars of your individual situation.

Example: A young couple in a 28% tax bracket who already itemizes, purchases a $180,000 home with a fixed 6% interest rate will save more than $250.00 per month on their income tax.

Move-Up Buyers
Most homeowners can sell their home every two years and pocket up to $250,000 (for single tax filers) or $500,000 (married filing jointly) in profit with no capital gains tax.

Scale-Down Buyers
Homeowners may scale down their housing without penalty, no longer do you have to purchase a home of equal or greater value.

Home Equity Loans
Interest is fully deductible on home equity loans, including a second mortgage or equity credit line,  up to $100,000, regardless of how the proceeds are used.

Vacation Homes
Mortgage interest on a second home is also deductible, there are separate tax rules depending on the owner's personal use days.  A residence is a vacation home if it was used personally more than 14 days or 10% of the days it was rented (if rented more than 140 days).

Before making decisions regarding selling or purchasing real estate and before filing your income taxes, you should consult with a professional tax advisor.









       




Home Warranty







When you negotiate the offer on your new home, you may want to ask the Seller to purchase a Home Warranty for you. The cost to the seller is usually less than $400.00. The Buyer is covered for one year for a variety of items. such as dishwasher, air conditioner, roof, etc. You may also purchase the Home Warranty yourself.  If you are a Seller, you may want to provide one of these warranties as a Buyer Incentive.

This is the way a home warranty works: when a covered item needs repair you call the toll-free number. The home warranty company sends out a certified technician to repair the problem. You pay a preset service charge, as low as $35.00. You pay a service charge for every call.

Each home warranty is a little different. If you want brochures from the different companies, please ask Sharon.  Several websites are listed below. As an informed Buyer, you can make the selection that best fits your needs.


American Home Shield
www.ahswarranty.com
800-735-4663

RS Andrews
www.rsandrews.com
404-766-6463

America's Choice 2-10
www.2-10hbw.com
800-775-4736

Old Republic
www.orhp.com
800-445-6999

BFS Home Warranty
www.bfshomewarranty.com
888-237-6060

First American
www.firstam.com/warranty
800-444-9030
Home Warranty of America
www.hwahomewarranty.com
888-492-7359

Home Security of America Inc.
www.onlinehsa.com
800-367-1448












Buy For $0 Down






Used to be there were several 100% loan products available, that is not true in today's economy. VA still offers 100% financing to veterans (Yeah!) and there is a local program that requires only a $1,000 investment from the Buyer. Currently, HUD foreclosures are only $100 down.

Call Sharon, tell her your goals. If a 100% product is what you need, Sharon will know if there are any products available to you..










Buyer and Seller Markets






Buyers' Market

A buyers' market refers to a marketplace that favors home buyers because more homes are listed than can be expected sell in the near future. If, for example, 20 homes are listed in a neighborhood, and 5 were sold in the last month, the neighborhood has a 4-month supply of homes for sale.   A balanced market is 6 months worth of inventory. With between 18 months and 24 months of inventory currently on the market, this is a once in a lifetime Buyers Market. Georgia is on sale, much of it on the clearance rack.  April 22, 2009 update--yesterday I ran an absorption report on a specifc Suwanee subdivision and there was only 8 months worth of inventory and zero foreclosures on the market for sale.  Wow.  

Sellers' Market

Of course, the market can - and does - change based on general economic conditions such as rising or falling interest rates, or the local business climate such as a new company opening nearby. If, for example, all 20 homes listed plus 5 new listings sell within a few months, then the market has become a sellers' market, where buyer demand meets or exceeds the house-for-sale supply.   One day this market will flip, from a Buyers Market to a Sellers Market.













How much house can I buy?   







When Buyers ask Sharon this question she prefers that they talk directly with a Lender because of the many variables. However, here is some basic information that can help you determine what you can afford. Conventional loans usually require that your total house payment, including taxes and insurance, should equal no more than 28% of your gross monthly income. This is called your "front" ratio. Your total debts including house payment, credit cards, student loans, car payments, installment loans, child support, should equal no more than 36% of your gross monthly income. This is called your "back" ratio. FHA and VA have slightly higher allowable ratios. How much house you can buy at payments you can afford depends on the loan product you choose.













Termite Control Companies






~~ Ask for a closing letter ~~


Everything about the termite letter changed in Georgia in 2007.  Most Lenders have not required termite letters to fund loans for quite some time.  In the majority of contracts, the only reason Sellers were required to provide a clear termite letter was because it was written into the Georgia Association of Realtors Purchase and Sales Agreement.

In 2007 the Georgia Association of Realtors modified the Residential Purchase and Sales Agreement and obtaining a clear termite letter became  the responsibility of the Buyer.  

For questions about termite letters,  termite  bonds, types of termite treatments, call any of the vendors below, or your Real-EstateResource, Sharon 770-846-5252


Allgood Pest Solutions.....770-963-6552

Accord Pest Control...... 770-271-5577

Tradmark Pest Solutions ................. 770-614-6534












Earnest Money   






At the time you make your offer you will be expected to put up earnest money in the form of a check or certified funds.  The amount will vary, Sharon has worked with investors that have put up as little as $10.  However, the purpose of earnest money is to show that you, the buyer, are in earnest.   The amount of earnest money the Buyer puts up is definitely at risk.  If you choose Sharon to represent you in the home buying process, she will negotiate this figure for you. 

The earnest money is usually held in the escrow account of the Selling Broker.  Sometimes the Listing Broker holds the earnest money in an escrow account and sometimes the earnest money is deposited into the operating account of the Builder.  On occasion, the earnest money may be held by the closing attorney.

If you and the Seller are not able to come to agreement on all of the terms and conditions of your Purchase and Sale Agreement and the house does not go "Under Contract", your check will not be deposited and you will receive a refund of your actual physical check.

Once the house goes under contract the earnest money is deposited and there is a procedure that must be followed before the earnest money can be released.  Sharon will be happy to explain the entire process to you, just give her a call or e-mail.

The earnest money goes toward your costs to close, downpayment, closing costs, etc.














Know the neighborhood


















How To Invest in Today's Real Estate Market






Investing in real estate is not for everyone.  But if you are looking for a way to increase your personal wealth, purchasing a rental property may be for you.  Another option you have is  to try and find a property you can "buy low and sell high". i.e. "flip".

If you are interested in investing, give Sharon a call and discuss your goals with her.  Sharon will give you valuable information about how to reach your goals.

Stories--Sharon worked with one investor that purchased and sold three properties over five years.  He reached both his operating and sales profit goals.

Stories--Sharon has regular clients who sell each two years, always striving toward their personal goals.   Some people want more house for the same payment; some people want to buy bigger and better; some people want to always have new; some people want a project with great sweat equity/appreciation appeal. etc.

Stories--Sharon has worked with both buyers and sellers in distressed properties.        















Title Insurance






When you buy a home, you want to be certain it is safely yours.  However, even the most diligent search of the public records could fail to disclose a number of title defects.  Without the protection of title insurance you could be in jeopardy of losing your investment.

There are two basic types of title insurance protection - one for the mortgage lender and one for the home owner.

If a mortgage is to be placed on your new home, the mortgage lender will probably require that you purchase title insurance to protect the institution's position as a holder of a mortgage loan.  But the lien holder's title insurance policy does not protect the home owner.  You need an owner's title insurance policy to protect your investment.

You pay only once.  There are no renewal premiums and there is no expiration date on the policy.  The protection lasts as long as you, or your heirs, retain an interest in the property.

An in-depth title search is required before purchasing title insurance and this expense is one of the closing costs of the loan.  If you purchase your owners title insurance at the closing table you do not have to pay for another title search.  Also, most attorneys will allow you to purchase a policy based on the mortgage lenders title search up to 30 days after closing. 

SHARON HIGHLY RECOMMENDS THE PURCHASE OF TITLE INSURANCE.



 

Some horror stories from the files:


Abe and Susan Giveme were a very pleasant, personable couple, greatly liked by their neighbors.  They made a good impression on Ron and Linda Lifelongdream when they purchased their home.   Mr. and Mrs. Lifelingdream were less impressed, however, when they heard from the real Mrs. Giveme.  It seems that Susan was not Abe's real wife, but his mistress, which meant that the deed of ownership she signed was invalid.

Mr. and Mrs. Toogoodtobetrue were charmed by the elderly lady.  Impeccably mannered, she explained that her country home had been vacant for some time, so she was letting it go at an irresistible price.  Mr. and Mrs. Toogoodtobetrue leaped at the offer, only to find out later they were unwitting victims of a classic forgery caper.  More cunning than charming, the old woman had learned that the real owners of the country home were living in Europe.  She forged a deed to the property and had it recorded in her own name.  Her low asking price assured a quick sale.  By the time Mr. and Mrs. Toogoodtobetrue were made aware of the scam, the little old lady was long gone.

 

Some of Sharon's true stories:

Sharon worked with a Buyer in Pickins County.  The home closed in early January.  Pickins County was, at that time, late completing a reassessment of the county properties.  The property taxes for the previous year had not been assessed, had not been paid, and the closing attorneys missed this fact.  Title Insurance protects buyers from unusual circumstances such as this one.

Sharon worked for a seller.  The week of closing it was discovered that the previous seller's deed had not been released and the mortgage company for that previous seller had gone out of business.  We were only able to close by making a claim on the title insurance my seller's had purchased when they first bought the house, 8 years earlier.

Sharon has a copy of an actual Title Insurance policy you can read if you want.  









February 14, 2010


Gwinnett County foreclosure ads running in February, 2010, for sale in March total 130 pages, we are still experiencing a very high number of foreclosures and it appears this trend is going to continue. Please remember, if you or someone you know is delinquent on their mortgage, I do understand the options. My advice, and help with loan modifications, is free.

The local real estate market is continuing to strengthen up. Bank of America has a new system for processing their short sales. The Realtors at RE/MAX Center are turning in increasing numbers of contracts, many of them regular homes (nor foreclosures or short sales). New buyers are entering the market every day trying to find their house before the April 30th deadline for the tax credit expires. One of the most interesting things I have noticed is new homes are being built again. There are some new ranch homes (3 bedrooms plus bonus over garage) being built in the new Mountain View high school area by a long-time developer priced in the $150's.

If I can be of assistance to you in any way, call or e-mail any time.


Signed Sharon













Links to my other web sites





http://sharonmerritt.com
http://sharonmerritt.georgiamls.com
http://collinshillhomes.com