Livonia, MI

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

Search Livonia real estate and Search Livonia foreclosures

A guy I knew became a fire chief of a small town. He came in and started changing everything. He had trouble in his last city as fire chief. He butted heads with the union, the town council, and the employees. Well he came into the small town and did itagain. After a few years the town council voted him out and brought back the retired chief to "straighten out" the turmoil.

He was abrasive and didn't get along with anybody. We as real estate agents sometimes get into situations with agents like that. Sometimes these agents only care about their own ego. By the time the transaction is over everybody hates them. The buyers, the sellers, and the other agent dislike them.

They forget that we need to work together to get the deal done. They forget that behind "the buyer" or behind "the seller" that they are people with feelings, fears, and worries. That's what we as real estate agents have to remember as we grow into successful agents.

Each client on both sides deserved to be treated special. Not just a another part of the million dollar sales figure. So remember that when you do your next deal. Don't be the jerk that guy I know is to the people he deals with.

How bad is the metro Detroit real estate market? If you ask about sales in the under $125,000 price range it ok.... low price decent condition homes are selling fast. But if you ask about how far the market has fallen then it is a total different story.

One of my clients closed on a Livonia condo today. It was over 1000 sq ft and we got it for $35,000. A few years ago it probably sold for $140,000. But was is even more remarkable is that the seller bought the condo for $61,000 nineteen years ago. Livonia real estate has dropped in value dramatically.

19 years ago the house sold for more than it is selling for today! It's unbelievable but true. 57% less than what is was 19 years ago! Some Redford bungalows are selling 25% of what the homes were selling for 5 years ago. Even my own subdivision is 40% off their highs of 5 years ago.

Russ Ravary your metro Detroit real estate agent.