Livonia, MI

If you are selling your Metro Detroit home here are the two areas you may have liability.

1. Tax liability - currently there is no tax liability because President Bush declared there would be no tax liability for on a principal residence. It hasn't expired yet. Before President Bush did that the banks would send out a 1099. The borrowers would be liable for the tax on the deficiency. If it is a investment property you can get a 1099.

2. Deficiency liability - Difference between sales price and loan amount. The banks can come after the borrower for the deficiency. The only protection the borrower has is if you get a release of deficiency letter for them. Many real estate agents are not following up on this. Some banks are putting the release in the short sale letter others are not. Some banks require the seller to be responsible for the shortage. It just depends on the bank.

So be careful and check with an attorney and your CPA also on what your liabilities may be.

So you are thinking of buying or selling real estate in Livonia Michigan? Well a little update on what we have been experiencing here over the last few months of 2009.

If you are looking at real estate to purchase in Livonia then you know that things have really picked up lately. Figure this--- if you like the home and feel it is priced right chances are so does someone else, of course that will be the one that sells. You and your agent can sit down and come up with a proper plan for your situation.

If you are looking at selling your Livonia real estate then you may not have been as active lately as a potential buyer. What we are experiencing is a huge surge of activity over this $8,000 tax credit. I can only speak for our team on this topic and here is what we have seen. Most of this big surge has come from a sense of urgency (created by tax credit) amongst Livonia home buyers. Many who were going to buy sometime in the future have decided to take the plunge now to take advantage of the tax credit.

If you have any questions or concerns please feel free to email us at info@BobandTeena.com or visit our websites at www.BobandTeena.com or www.LivoniaBusyBees.com

Why do I need to put money into a escrow account?? I have already had to pay for one full year of homeowners insurance already? Why do I need to come up with more money for closing?

That is a common comment or question from many Metro Detroit first time home buyers. Whether you are Buying Livonia real estate or Farmington home it's the same. To explain it simply..... an escrow account it is basically a savings account set up by your mortgage company to make sure your property tax and insurance money is there when it comes due.

You can't give an IOU for taxes.

In the Metro Detroit area we have two taxes a winter tax and a summer tax. The winter tax is due Dec 1 and it covers from Dec 1 until November 30 of the next year. The summer tax is due July 1 and covers until June 30 next year.

Each month you make a house payment your payment includes 1/12 of the summer taxes, 1/12 of the winter taxes, and 1/12 of your homeowners insurance. Let's say we are going to close on November 1. You are going to make one payment before December 1. So you will have only 1/12 of your winter taxes in the account. But 12/12 is DUE!!! So the mortgage company is going have you put 11/12 of the winter taxes in the account if you close on November 1. That way you will have the full amount that is due on December 1.

The same thing goes for summer taxes. It's due on July 1 and you are only going to make Dec, Jan, Feb, Mar, Apr, May, Jun, payments. That's only 7/12 of the amount due. You have to have 12/12 to pay your summer taxes. So the mortgage company is going to have you bring 5/12 of the summer taxes to closing.

So basically you need to set up your "savings account" for property taxes and home owner insurance so the mortgage lender can pay your bill when it comes due. That's why you need to bring money to the closing to set up your escrow account.

If you still don't understand this feel free to call me or email me and I'll be glad to explain it to you a little better.

Russ Ravary your Metro Detroit Realtor

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O.K. maybe not all of them. There is an agent in my office who does a lot of bank owned transactions and she's upright, honest and helpful. I can think of two or three others around the Western Wayne, Oakland County area of Southeast mi that are the same way.

Isn't that sad? Only a handful of agents who do work for the banks are actually solid, honest agents. The rest are, in my opinion, well....read the title again.

Someone may be upset by this post. If you are, you can reply with a disagreement as long as it's a cogent argument against my points. If you flame me, I'll just figure you're part of the problem and I cut too close.

Some may ask why I'm posting this for all to see as opposed to members only. It's just that I feel that clients and the public in general should know how these agents are treating other agents. If agents are being treated unfairly so are the clients they work with.

As you may be able to tell, I've been burned a few times over the last few weeks. Here's the senario. It may sound familiar.

A client calls to see a home that came on the market that day. We get in that day. I call the agent with an offer that day. Low and behold he already has three offers, all cash. He tells me there's no reason to put in another offer. Then I ask if these offers were asking or above. One of the offers is close to asking, he replies. I then say we're coming in over asking and I hear the panic in his voice. "Hurry and get it in because the other offers have already been submitted!"

I send the offer in but it suddenly is PENDING in the system. When I call the listing agent, he has an offer 1,000.00 higher than ours, so we're out. Later when the sold report comes up, sure enough, it's the lisitng agents buyer who had a conveniently higher offer than ours. No highest and best, no call to compete.

I don't know about other states but this is a very common around the Detroit area. And it needs to end.

Does it seem strange to anyone that most REO agents are the lowest of the dregs of our business? Someone who wasn't even in Real Estate 2 years ago and won't be when the market turns around? Or someone who was a marginal agent for years and suddenly gets in with a bank?

My broker recently attended the Michigan Association of Realtors (MAR)convention and you may be surprised at the number one item that MAR was concerned with. No it wasn't the economy. It was the sudden and profound drop in professionalism in our business. MAR and NAR are aware of the problem but what are they doing about it.

My next entry will discuss who's to blame for this and, hopefully, what we can do about it.

Livonia homes are selling. 1st time home buyers are snapping up the homes.

Here is a quick glimpse of what has happened in the Livonia real estate market in the last 30 days as of October 10, 2009

Livonia real estate is all over the board. Some Livonia homes are selling well over list price. You will notice that most are selling for very close to list price or over list price. But their are some that are selling for less than list price.

Their are still crazy people out their over paying for homes. I am glad they aren't my clients! If you have any questions always feel free to call me or email me. cell 313-310-9855 or yesmyrealtor@gmail.com

Russ Ravary your Livonia Realtor serving Macomb, Livingston, Oakland, and Wayne County

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