Ardell’s Seattle Area Real Estate Blog – Most Visited Posts

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It amazes me sometimes, which of my posts garner the highest readership. Dustin tracks the “per post” stats for Rain City Guide and shows us which garner the most eyeballs…from time to time.

I was looking at the numbers over on my blog, which likely gets a fraction of the activity as my writings here. But once in awhile I get surprised by a single post getting over 20,000 views…for just one post. Usually they are posts that spark an interest nationally vs primarily local here in “The Seattle Area”.

Here are the blog posts with the most views, not necessarily in the order of highest to lowest:

Sex and Real Estate – AKA What’s Cooking in the Master Bedroom?

How is a Real Estate Transaction like a Pregnant Woman?

Negotiating Real Estate Commissions

Should I Buy a House Now? (Amazing how this post from Summer of 2008 is still equally as relevant today.

For Buyers Who are Relocating to Seattle – The Yes, No, Maybe tour method

Split Entry Homes and the different names they are called around the Country.

Ardell’s Anatomy of a Real Estate Transaction which is the older and longer version of This Year’s “From Contract to Close of Escrow”, written here on Rain City Guide.

What Does a Real Estate Agent Do?

Is your townhome a condo or a single family home?

Do I need to Sell My House before I Buy a New One?

Home Sales Way Down October 2007

Who do you make your Earnest Money check payable to?

The Appraisal in the Home Purchase and Sale Process

Sample Closing Statement – HUD 1 I posted the link to the source I now use vs my original post, given there have been changes over time. I used this the other day for a client who is closing in January. You can plug in the estimated numbers and save it and email it. It’s a very good idea for buyers and sellers to see these numbers on the form they will be signing at closing, as early in the process as possible.

Kirkland Real Estate Stats as of Today (that “today” was a long time ago. I’m doing the 2011 stats now. Will be interesting to do them on the same basis for comparison purposes, with the same type of charts.

Pottery Barn Paint Colors and other tips on your Seattle Home

Homes “Sold” by Ardell DellaLoggia – a running and updated catalogue of homes where I represented the Buyer or the Seller, noting which I represented for each home.

Will the 520 Toll Bridge Change Where You Live?

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Good-to-Go-520Before we talk about the potential future impact on Real Estate of charging up to $10.00 a day for traveling on the 520 bridge, let’s look at a few notes.

1) The first guy to use the Bridge since the toll was put in place was going 76 miles an hour. Why? Reportedly because the rate you pay is time dependent, and he only had a few seconds to beat the higher toll cost. When the car or cars in front of you are traveling too slow, and upping your intended cost of making it through the toll indicator…well, we might be seeing a little more “road rage”, I think.

2) Traffic on The 520 Bridge is reportedly down 45% and the I-90 Bridge traffic is reportedly up 20%. Not much more on that until we get past the Holidays. Plus I’m sure there are many who are not wanting to be the first guinea pigs of the new system.

3) On a personal note, I heard Kim griping as he was registering his pass. He purchased it at Safeway. He said there were 7 or 8 pages of data needed to complete the online registration. Sounded like they wanted his blood type and shoe size to get to the end of it all. 🙂 …and the Good To Go Sticker is still sitting on the table.

When you think about the potential of paying $2,000, give or take, a year to get where you need to go, I would think this change makes it that much more important for you to live on the same side of the bridge as where you work.

Moving to that same side of The Bridge will likely impact those renting vs owning more in the first year. Buying in a location that does not involve the toll will also have it’s impact in the first year of operation. But actually selling your home to buy elsewhere due to the cost of the new toll? I doubt that factor alone will be the single impetus for moving…but it might just be “the straw that broke the camel’s back”.

If it continues to make getting the the other side much faster…well, many may think the toll is worth the added speed. Some will move, just “on principle”.

Are Buyers Getting Ripped Off with REO Escrow Fees?

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[Warning: rant ahead].

Recently I’ve closed a couple of REO transactions lately where I’ve been dismayed at what the escrow companies are charging the buyers. They claim it’s is warranted because of the extra work that goes into processing a bank owned property…I could almost buy this EXCEPT it’s not the buyer who has created any additional work.

Adding to my frustration is that this exorbitantly higher escrow fee tends to not be split equally between the buyer and  seller (the bank or lender). I’ve heard of builders receiving discounted escrow fees, however the buyer pays what would have been the normal half.  With the REO’s I’ve seen lately, the fees have been almost double what I would consider “normal”.  Some of the fees have been so high, it can jeopardize a smaller transaction becoming a “high cost loan”.

On a recent closing, on a $70,000 condo in West Seattle, I called to obtain a quote from an escrow company where Freddie Mac was the seller. The quote I received was for $848. I asked the assistant if this was the full fee or the buyers half, since the quote I was using from my preferred provider was $438. She replied “full” (meaning the $848 would be split 50/50 between seller and buyer). When we received our estimated HUD, the buyer’s escrow fee was jacked back up to $848 and to make matters worse, the escrow company was trying to not honor their written quote to me. After dealing with several managers, the escrow company agreed to meet my quote of $438…it’s not half of $848 but it’s definitely closer to what would be a fair escrow fee for the buyer in this price range.

To add insult to injury, it seems the service from these escrow companies is lack-luster to say the least. It’s as if the company “won” a big bid and therefore service to the buyer, the consumer, just isn’t important since there will be plenty of gravy business to continue.

Home buyers can shop for their escrow provider, however when it’s an REO situation, 9 times out of 10 (if not all of the time), the escrow company has already been dictated.

I understanding charging more when there is more work that is actually being done with a transaction – as long as it’s fair and reflects the actual level of work that’s being done on that transaction.

It really frustrates me.

SIDE NOTE: I’ve only had excellent service from Legacy Escrow – my rant has NOTHING to do with them.

Rant over…for now!  🙂

Toll Brothers Comes to Seattle

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CamWest announced, via email to its clients and prospective clients, that they have been purchased by Toll Brothers.camwest The CamWest logo now says “A Toll Brothers Company”. I’ve long been a huge fan of Toll Brothers since my early days in Real Estate back in Bucks County, PA.

Toll Brothers made the announcement back on November 21st, and I found the comments made by Toll Brothers CEO to be interesting, spot on and less “fluffy”.

CEO Douglas Yearley Jr. said the CamWest acquisition does not represent the start of a broader expansion push by Toll, which operates in 20 states.

“We have been looking at Seattle for a decade, so this was a bit of a long time coming, and we found the right opportunity,

2012 Conforming and FHA Loan Limits for King County

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The 2012 Conforming and FHA loan limits for King, Pierce and Snohomish Counties have been announced… ready for a little twist?  Conforming loan limits will remain the same as they currently are and FHA loan limits will be restored to the higher “temporary” loan limits that were available prior to October 1, 2011.

For a single unit residential property in King, Snohomish and Pierce County, the 2012 loan limits are:

  • $506,000 Conforming
  • $567,500 FHA – NOTE: FHA loan limits are effective as of November 18, 2011.

Yep… for the first time (I’m guessing ever) FHA loan limits are higher than conforming!  I’m reading in the blogo-sphere that the higher FHA loan limits are available – HOWEVER, I am not seeing this from HUD (on their loan limit site or a Mortgagee Letter) or from any of the lenders I work with.  Until I see something from HUD or a wholesale lender saying they’re accepting the higher FHA loan limits, then my assumption is that $506,000 is the loan limit through the end of this year.  If I learn otherwise, I’ll let you know!

UPDATE December 5, 2011:  HUD published a mortgage letter Friday and updated their website this morning (or in the wee hours last night) with the higher loan limits.

2nd Annual “Give Warmth” Coat Drive

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Give Warmth Coat DriveI’m getting all excited about seeing my family on Thanksgiving!

In the Spirit of Giving…let’s all bring some warmth via new or slightly used coats, sweaters, gloves, scarves…we all have a ski hat or two that we’ve been given and never worn!

Your gifts of warmth accepted and appreciated through December 3rd! All donations will go to Friends of Youth in Redmond.

For more info, see this post written by Carolann Joy Salon. They have a drop off point at their shop at 8336 164th Ave NE Redmond, WA 98052 (The White Victorian House next to the 7/11) or contact Friends of Youth direct at 425-869-6490.

“Your donated coats don’t have to be brand new; gently used coats welcome. Other types of outwear are acceptable and appreciated, like sweaters, jackets and sweatshirts. Even blankets, hats or gloves could help someone stay warm this season.”

If anyone wants to set up a drop off point in another location, I will be happy to pick up and bring over to the Eastside at the end of the drive as well. Just email me or give me a call.

Financing Your Seattle Starter Home

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Ardell is beginning a series about styles of starter homes in Seattle. I thought I’d offer a companion post on a few different financing options for that home based on the list price she’s suggesting of $350,000.

Rates quoted in the post are effective as of November 1, 2011 at 2:00 pm.  I’m using 1.25% of the sales price/12 for the property monthly taxes and estimating home owners insurance at $50 a month – a total guestimate on my part.  I’m using a low-mid credit score between 720-739. Adjustable rate mortgages are also available – however in the interest of getting this post up in a timely manner, I’m sticking with 30 year fixed rates with minimum down payment scenarios.

A majority of first time home buyers may lean towards FHA for financing if they’re shy a significant down payment.  FHA currently allows a minimum down payment of 3.5% of the sales price, which can be gifted by a family member. Sellers can contribute up to 6%, however it must go towards closing costs and prepaids – it cannot be applied towards the down payment.  FHA has upfront and annual (paid monthly) mortgage insurance which is slightly reduced if the borrower puts at least 5% down instead of 3.5%.  Another plus about FHA insured loans is that they may be assumable to a future qualified buyer.

FHA 30 Year Fixed at 3.750% (apr 4.581) currently offers rebate pricing which reduces closing cost to approx. $256 with prepaids/reserves being additional.

  • Principal & Interest payment = $1579.81 plus mortgage insurance of $323.68 and est. taxes & insurance of $415 = total monthly mortgage payment of $2,318.49
  • 3.5% down payment = $12,250 minimum borrower contribution (can be gifted by family member)
  • Seller can pay closing cost plus prepaids/reserves estimated at $2940.  Total funds estimated for closing at $15,190.

In my opinion, more sellers should be willing to accept VA buyers – I’m saddened more don’t just on the basis these brave people served our country.  VA loans are not as challenging as they once were.  The Veteran cannot pay for the escrow fee, other than that, unless the seller wants to pay for closing cost (as they may with most any other type of transaction) the cost is minimal or no different for the seller.  VA just reduced the funding fee for these loans – making them more attractive to our Veterans.   Many qualified Veterans opt for to use this program as it offers zero down financing and no annual mortgage insurance and it’s a benefit they’ve earned.

VA 30 Year Fixed at 3.750% (apr 3.898) also has some rebate pricing (not as much as the FHA scenario) with closing cost (not including the buyer’s escrow fee) estimated at $1887 with prepaids/reserves being additional.

  • Principal and interest payment = $1643.60 plus taxes and insurance of $415 = total monthly mortgage payment of $2,058.60.
  • Zero minimum down payment required.
  • Total estimated closing costs and prepaids = $4592 which the seller can pay if negotiated in the purchase and sales agreement.  Total funds for closing estimated at $4592.

Conventional 5% down payment with private mortgage insurance.  Private mortgage insurance has been gaining in popularity for those who can qualify for it. This is mainly due to HUD’s latest increase to FHA’s mortgage insurance premiums.  With a 5% down payment, the seller can pay up to 3% of the closing closing cost.  There are different options with how private mortgage insurance with how it can be paid.

All of the conventional scenarios are with a 5% down payment of $17,500.

30 Year Fixed with Monthly Private Mortgage Insurance: 4.125% (apr 4.777).  Closing cost with the current rebate is approx. $2,930.

  • Principal and interest payment = $1641.46 plus mortgage insurance of $249.38 plus taxes and insurance of $415.00 = total monthly mortgage payment of $2275.84
  • Total estimated closing cost, reserves and prepaids = $5853 which could be paid for by the seller.  Total funds for closing estimated at $23,353.

30 Year Fixed with Single Premium Mortgage Insurance: 4.125% (apr 4.391).  Single premium mortgage insurance is just that – mortgage insurance that is paid for in one lump sum at closing. With 5% down, I think it’s rather expensive however, if the buyer was able to negotiate the seller paying for closing cost, it would really be worth having it go towards this.  Closing cost with rebate plus the single premium mortgage insurance comes to $10,278.

  • Principal and interest payment of $1611.46 plus taxes and insurance of $415.00 = total monthly mortgage payment of $2026.46.  NO monthly mortgage insurance.
  • Total estimated closing cost, reserves and prepaids are estimated at $13,201.  The most the seller can contribute is 3% with a 95% loan to value, which is $10,500.  Buyer would need at least $20,201 including down payment assuming the seller contributes the maximum 3%.

Split-premium mortgage insurance is a combo of monthly and single premium and I think a more likely scenario at 5% down than a single premium scenario.

30 Year Fixed 4.125% split-premium mortgage insurance (apr 4.586%).  Closing cost with current rebate pricing and reduced upfront mortgage insurance premium is estimated at $6709.

  • Principal and interest payment of $1611.46 plus mortgage insurance of $130.23 and taxes and insurance of $415.00 = total estimated mortgage payment of $2,156.69.
  • Total estimated closing cost, prepaids and reserves are estimated at $9,178 which the seller could hypothetically pay for since it’s under the 3% cap.  Total funds for closing are $26,678.

Now if this home was a Fannie Mae Homepath property (meaning the seller is Fannie Mae) it would qualify for the Fannie Mae Homepath mortgage which does not have private mortgage insurance (for credit scores over 660) and there is no appraisal required.  Fannie Mae Homepath will go as low as 3% down payment for owner occupied and 10% down for investment properties – however we’re just talking about buying your first home (primary residence) in this post. 🙂  You do receive preferred pricing at 5% down over 3% so if you can come up with that extra 2%, I highly recommend it! With Fannie Mae Homepath, the seller can contribute up to 6% of the closing cost if negotiated in the purchase and sales agreement.  Fannie Mae often has buyer incentive promotions where they chip in for a majority of the closing cost.

30 Year Fixed Fannie Mae Homepath Mortgage with 5% down payment:  4.875% (apr 4.947%) with closing cost based on factoring current rebate pricing at $2124.

  • Principal and interest payment of $1,759.62 plus taxes and insurance of $415 for a total monthly mortgage payment of $2,174.62.
  • Total estimated closing costs, prepaids and reserves are estimated at $5,148 which the seller could pay for. Total funds due at closing estimated at $22,648.

USDA loans also offer 100% financing but are not available in Seattle.  If this home was located in more rural areas, such as parts of Redmond or Duvall, it would possibly qualify this type of financing.  Since we’re talking about buying your first home in Seattle, I’ll leave USDA for a future post. 🙂

PS: I know I refer to the seller being able to contribute towards the closing cost on this post several times.  Real estate agents and or builders may contribute as well however, the total contribution amount (seller + agent + builder) cannot exceed the percentages that I’ve referenced.