About Roanoke County, VA

I am currently dealing with HMBI, our Virginia sub-contractor for HUD concerning a property which I bid on and was awarded the sale on behalf of a client. This is interesting to me: One simple exchange that took place at exactly 4:55 pm EST via telephone a couple of days after overnighting the ratified contract to their office, over 3 weeks before our expected settlement date. I had just popped back into my office after a busy day out and about. I only expected to check a couple things and have the rest of the evening off. I happened to be at my desk when my cel phone rang.. It was the HMBI employee assigned to our case. She immediately informd me of a simple mistake on the contract which needed to be changed- no problem. Then she informed me that the EMD guidelines in their instructions are wrong and an addition $300 was need for the deposit. This in itself was an issue as my client has scraped together all she thought she could and was having to come up with far more cash than we originally expected. But still I was not overly concerned at this point, should not be a big deal, we'll work it out. Here's the shocker: This was on a Tuesday. I told said employee that I would speak with the buyer the next day (she was unavailable Tuesday) and get everything taken care of by Thursday. This was unacceptable according to their guidlines. i had to have it done by end of business the next day. I was in shock. In the end I managed to get it done but quite a personal sacrifice was required by my client. I will do everything to not allow this to happen again, but wow! No flexibility from HUD at all. they would not give me one extra hour much less a whole day.

If you’re reading this, your probably in one of the following stages in your life: Either you currently own a home & want to renovate, you’re thinking of buying a “fixer upper” as your home, you want to sell your house & buy a home that needs a little work, or your home is on the market, but it just won’t sell!

1^st things 1^st, let’s start by asking:

“What makes a Renovation Loan (FHA 203k) different from a Traditional mortgage?”

A “Traditional Mortgage” is one that the lender only approves based on the current value & condition of the property. If you find a home (foreclosure) that might truly be worth $300,000, but have arranged for a purchase at $210,000 (great deal btw!) the traditional lender will only lend up to the $210,000 your contract price. Now, say it’s not a necessary fix, but you want to upgrade the kitchen & add new windows. Even though there is already equity in the property, with a Traditional mortgage you would have to pay for the upgrades with your own money. Common sense may scream “There’s $90,000 worth of equity in the property, why can’t I just include it in the loan?!?!” The traditional lender doesn’t care…your contract price = the max loan amount.

Here’s the great part… using the same purchase scenario as above, a Renovation Loan (FHA 203k) WILL allow you to make all of the upgrades AND include them in your loan. A FHA 203k Renovation loan lends based on the AFTER-IMPROVED market value of your upgrades/renovation…not the current value. This changes the game completely!!! Instead of having to bring an extra $40,000 to closing (assuming that’s what the kitchen & windows cost), now it’s included in the loan and you keep your money in the bank! Let’s talk about a few more real world examples…

I own a home, but want to renovate…

Maybe you’ve been watching a lot of ABC’s “Home Extreme Makeover” and want to turn that old 70’s kitchen into the new bright, shining, stunning kitchen of 2008. You want to knock a few walls down, replace the flooring with hardwood, new appliances, granite countertops, etc… You have primarily two options. If you already have enough equity in the home, you can simply do what’s called a “Cash Out refinance” – which means we refinance the current mortgage and pull enough cash out to pay for the projected renovation…that simple. But, what if you don’t have enough equity in the property to pay for the renovation? That’s where the FHA 203k comes in… Say your home is currently worth $200,000 and you owe $190,000. You only have $10,000 worth of equity ($200k – $190k) which is not nearly enough to cover the projected $50,000 (example) cost of renovating. But, say the improvements will cause your home’s value to skyrocket to $270,000 once they’re complete, versus the current value of $200,000. We would lend on the AFTER-IMPROVED value and simply include the cost of renovation with your current mortgage balance for a total loan amount of $240,000 (original balance of $190k + $50k improvements)…and now instead of having $10,000 of equity…you have $30,000 (new value of $270k – new mortgage of $240k)!!

My home’s on the market, but it just won’t sell…

Often times, when prospective buyers are walking through “Open Houses” or visiting potential new homes they are stalled by the blemishes or older characteristics…even though the property may be wonderful for them. It’s difficult for them to maybe see the true potential simply because the windows need to be replaced, or the HVAC system is old, maybe the plumbing needs updated, or even the roof needs replaced – but the current seller may not have the funds needed to make those improvement prior to selling.

Think about your home through the eyes of a new buyer… Are there traits that may need to be updated? If so, have your Realtor partner with an FHA 203k Renovation expert to draft a glimpse of what the property could be like AFTER the improvements, that a prospective buyer may want, are complete. Show them the pot of gold at the end of the rainbow! Educate the buyers that their improvements CAN be included now in their purchase! YOU WOULD BE AMAZED AT HOW MANY REALTORS DO NOT KNOW THIS OPTION EXISTS!!!

I’m thinking of buying a “fixer-upper”…

Just as we talked about above, this is a great option! With a traditional mortgage, you would have to pay for any of the improvements with cash out-of-pocket in order to buy a property that needed some TLC.

Now, instead of using out-of-pocket cash to make the improvements, use the Renovation Loan to purchase & allow the equity to work for you!

What can the FHA 203k Renovation Loan be used for?

There is a LONG list of eligible improvements allowed for the 203k. Pretty much, the only things that wouldn’t be allowed are luxury items that can’t be included as a permanent piece of the property (i.e. 60” Plasma TV’s, etc…). But, here are a few that can be included:

• Bathroom remodels
• New Siding
• Attic build-outs
• Adding a 2nd floor
• Granite countertops
• Bedroom Remodels
• Upgrading HVAC
• Going GREEN! (Solar panels, energy efficient appliances, etc…)
• Many, Many, Many MORE!!!!

Now, What’s the Loan Process Like?

Apply for Pre-Approval!!!! I honestly can not stress this step enough. I’ve seen it many times…couples get excited about renovating, they’ve designed the kitchen, picked out the appliances, selected the contractor…only to then find out they can not be approved. Granted, the requirements are less stringent than a conventional mortgage…but that does not mean everyone will be approved. So please, do yourself a favor & talk with a 203k Mortgage Planner first…plus…I like joining in on the fun of watching you go through the designing process…

Here’s what needs to happen (preferably in this order):

• Call me or email me & we’ll take care of your Pre-Approval
• On-site consultation with Appraiser, Contractor, & Mortgage Planner
• Receive bids & Architectural designs (if needed)
• Property Appraised
• Loan submitted, underwritten, & conditions cleared
• Loan closed & repairs begin
• Total Loan Time: 30 – 45 Days!!!!

The process for qualification, approval, and fund disbursement is really quite easy on your part. If you look at the process through the eyes of the lender, it becomes more of a common sense approach than anything else. If you were the lender and planning to give money to a family, you would want to know that someone in that family has a stable job, has shown their ability to pay loans in the past, and has enough resources currently to stay on time with their payments. That’s it! Obviously, there are a few other small items that would need to be addressed, but leave that to us…

Wrapping up…

This loan absolutely has the potential to create personal wealth and a huge amount of equity from day one. Even more significant, it gives a sense of hope & renewal to families in an economic environment that does not foster such characteristics at the moment. I’m passionate about helping others turn the house they have…into the home they want!

Feel free to call or email us anytime with questions…we’re here to help.

Cheers!

It took all of about 30 seconds to become addicted to reading friends’ status updates. Not something I’m proud of, mind you…yet, lately, has proven to be not-so-unusual…and facebook knows this.

Aside from rummaging through friends’ photos like you’re spying on them from the outside, status updates provide a glimpse into the “Jone’s” lifestyle…which hike they went on this weekend, who’s house they watched the Hokies game at, where they took their kids for their birthday party, what they ate for breakfast, etc… We’ve all seen them, but now the game has changed!

Facebook recently announced its newest capability – which now enables tagging of status updates for Friends, Pages, Events & Groups. Many of my friends have been asking “Why is that so important…seriously, who cares?”. Answer: we ALL should care, and here’s why:

Facebook has become famous for its ability to allow photo tagging of friends, causing an extreme viral effect. We’ve all experienced it. We try to maintain semi-professional facebook page, while Timmy (the friend you haven’t seen in 20 years) thinks it’s hilarious to tag you & post a photo he generated from yearbookyourself.com to your page. Meanwhile, every single one of your coworkers, clients, and friends have all seen it before you have a chance to untag…been there, done that.

Now, though, facebook has taken it up a notch (a giant one, at that). Riding Twitter’s coattails by copying the already popular “@” Mentions style, will prove to pay off. This is fantastic for businesses & nonprofits who have already embraced Social Media Platforms as a way of attracting & engaging customers/supporters. Fantastic b/c it has unlimited potential for creating massive amounts of buzz…whether good or bad.

Example #1: I go to Debbie's Cakes & have her make a SpongeBob Squarepants cake for my daughters and she does a great job. I might post something like “Just picked up the SpongeBob cake for my daughters…WOW! Not only was she just as good as Ace of Cakes…she was drastically cheaper!”

or…

Example #2: Maybe I go to a local restaurant & receive not only the worst service, but also something…other than what I ordered in the food. The viral effect could be MUCH worse. “Seriously “local restaurant”? A roach in our spaghetti?!?! – never again eating there!”

Either example creates an instant viral tsunami that’s virtually uncontrollable. Just think…if you have 300 facebook friends who just saw either update & 20 of them decided to repost & tag? That’s a possible 4,300 sets of viewing eyes! (Assuming each of the “reposting” 20 friends have at least 200 friends each. (20 * 200 = 4,000. 4,000 + 300 original viewers = 4,300) Viral in it’s purest form!

The wording doesn’t change, but the effects do. It used to be (just last week) that someone would post a positive, or negative, update and we would all just read the name and move on…sometimes throwing in our 2 cents. Now, by tagging, we can just click on @MichaelHyatt and put a face to the name instantly. Thus, aiding in brand creation for that person, company, group, or non-profit…whether they want it or not.

Plus…it’s crazy simple. Facebook has done all the work for you. In your “What’s on your mind” box, type the “@” symbol and directly after – start typing a friends name. In the pic below, I’m typing that I just finished coffee with Ryan Salvi and his name starts to auto-populate.

Here, feel free to try: Go to your status update box and type “Just read a great blog about facebook changing the game…thanks @joshperrington!” - then post, that simple. You’ll love it…

As we’ve all heard “May the force be with you”…this new facebook tool is not to be taken lightly. As always, the power’s all yours…just use it wisely.

Disclaimer: @MichaelHyatt is an amazing individual & was merely used for purposes of explaining the example!

As of late, I've been running into altercations with real estate agents who have a conflict with having a home staging sign posted in the yard along with their for sale sign. What is interesting is that they all have varied reasons why they don't want the sign out front....and in all honesty, their reasons just don't make sense. The latest reason was this: "I want people to focus on the home itself, not give a false impression that the home always looks like this." What??

Home Staging is designed to help the buyer see the entire home at its best. I spend time with my clients helping them understand that touching up paint here, cleaning areas there, and removing signs of build up, spider webs, pets and odors are simple things they can do that are extremely advantageous for them. THEN I address "packaging" the home to look fantastic. They understand the reasons and are so in awe when it is all complete. So why is it an REA compliments how beautiful the transformation is, raises the price to reflect such an awesome transformation, then questions why I want to post flyers/cards in the house and a sign in the yard? I don't believe somone who walks into a home questions if it always looked like it does during an open house.

I would really appreciate hearing from other home stagers to see how common this is for them, their feelings, and how they solved the conflicts. I do have signage covered very specifically in my contract and I'm sticking to my guns, but I do wish I didn't have to continuously explain that home staging can help them sell the home faster, not hinder the sale. At the same time, I'd like to hear from real estate agents as to their reasonings behind their reluctance to have buyers know a home has been staged. Even if someone wants to view the home just because it's been staged, it is advantageous....they will spread the word to others and the result could be a great sale.

Thank you in advance for expressing your thoughts on such a diverse and convoluted subject.

Cathy

www.Final-TouchDesigns.com

People who know me, know that I am a little bit of a technology freak! I mean, in this business we are somewhat blessed that we can actually use the newest gadgets and be legitimate about it.

Well, last week I was on the phone with Verizon for over an hour getting my Blackberry straight. Anyway, while I was on the phone with the customer service representative (who was awesome) she mentioned a new device that Verizon had out called a “MiFi”, a personal WiFi point. (This MiFi card will allow up to 5 different users to access the internet through your card, as long as they are within 20-30 feet of your card) As soon as I was off the phone I was in my car headed to my local Verizon Store at Valley View Mall in Roanoke VA!

You see, I have used wireless cards for years as my primary internet source and I have always had the frustration of nobody else at the house could be on the computer while I was on it…..the curse of rural living! (Verizon was the first in my area to go high speed so I naturally progressed to them since speed is time and time is money.)

Upon purchasing my “MiFi” I quickly installed it and loaded the software (I did have to call customer service and have them walk me through some settings) and was on my way. This thing is incredible! I have used it anywhere and everywhere I go. I have been on it and had other agents sign on to test it and now if my girlfriend and I need to be on the computer at the same time it is simple as accessing a WiFi point. This is a “must pack” item for anytime I go out of town, especially with some hotels and resorts charging up to $20.00 per day for internet access! This wireless card works like any other wireless card, as long as you have signal you have internet. It is particularly handy for travel so that your travel companion can surf the web on a lap top instead of a blackberry. Clients are impressed that you can pull the laptop out and share the information you are looking at with them as opposed to looking at a blackberry screen.

All in all I give Verizon a huge thumps up for the MiFi!