David Krushinsky

"You're in good hands with..."

"Like a good neighbor..."

"Own a piece of the rock."

What do these phrases remind you of?

That's right, insurance. We all love insurance when we need it but hate to pay the premiums. And premiums are costing us more and more every year. Insurance rates seem to go up about 15-25% per year. But there may be some savvy steps you can take to lower the bill and still have your valuables protected.

Items that push premiums higher include a pool with a slide or diving board, having a trampoline, or even a dog that has a record of biting others. These factors could be part of higher premium costs, so contact your local Glendale, AZ insurance agent and see if changes can reduce your premium payments.

There are also interior items that can impact the cost of insurance. The coziness of the wood-burning stove may be appealing to you, but to the insurance agent it could look like a fire hazard, and result in a higher premium. We ususally don't have this problem in Glendale, AZ but in the pines this may increase your annual costs.

If you have not done so already, investing in a good alarm system may enable you to shave some of the cost of insurance, while giving you some added protection and peace of mind. And be sure to ask your insurance agent about combining auto and home policies since this could help trim the overall cost of your insurance bill, too.

Often times, once the insurance policy is purchased it sits in a drawer until the need arises to file a claim. But taking the time to review your personal insurance policy, just once a year, provides the opportunity to lower the overall annual premium and makes sure your valuables are adequately protected. It is also the perfect time to make any additions for personal possessions that may have been purchased or acquired during the year, like art, home furnishings, and jewelry.

Additionally, if your Glendale home has been remodeled using the 203k loan discuss the upgrades that have been made with your insurance agent to ensure that all upgrades are covered in the policy.

It's not a bad idea to have your insurance reviewed every few years to make sure that your insurance provider is competitve with their rates and fees. I recommend scanning all your insurance documents, getting a few referrals of local Glendale, AZ insurance agents and having them quote the policies you currently have in force.

Remember, if you need a recommendation to a great insurance agent, just give a call at 602-695-7575 or david.krushinsky@wjbradley.com!

This is a home that Won't meet the requirements for an FHA loan on Phoenix. Below are the guidelines most appraisers look at when they visit a home to appraise it for an FHA loan.

1: Home Inspections: Borrowers are encouraged to obtain a detailed home inspection of the property. Borrowers should research home inspector's qualifications and designations to ascertain that they feel comfortable with the individual they hire.

I recommend asking your Realtor for a referral of a qualified Home Inspector.


2: Repairs and Alterations: Deficiencies, required repairs, alterations and/or required inspections must be reported within the appropriate section of the applicable appraisal reporting form. (See Mortgagee Letter 2005-48 and 2005-34)


Required Repairs: Required repairs are limited to those repairs necessary to preserve the continued marketability of the property and to protect the health and safety of the occupants, A.K.A. the three S's:


Safety: protect the health and safety of the occupants
Security: protect the security of the property (security for the FHA insured mortgage.)
Soundness: correct physical deficiencies or conditions affecting structural integrity


Properties in Poor Condition: If the subject property is in such poor condition that it may be cost prohibitive or impractical to bring it up to FHA's minimum property requirements, the appraiser should recommend rejecting the property and contact the Lender before continuing with the assignment. If continuing:


Complete the appraisal on an "AS IS" basis, clearly marking the report as recommended for rejection for Section 203(b) and provide reasons for the rejection;
Provide a list of all major deficiencies and state that the list should not be considered all-inclusive. Additional items may be required before acceptable for FHA Insurance; and
Provide photographs of deficiencies to support recommended action.


3. Code Enforcement for Existing Properties: As stated in HUD Handbook 4150.2 HUD has neither the authority nor responsibility for enforcing code. This rests with the local municipalities.


4. Clearing Conditions on Existing Homes

All repair items required by the appraiser or underwriter must be inspected and the clearance documented.

A professionally licensed, bonded, registered engineer, licensed home inspector or appropriately registered/licensed trades person, as applicable, must provide documentation that all deficiencies have been acceptably corrected upon completion of repairs. "As applicable" has been determined to mean any individual who the lender deems to be qualified, which might be the appraiser.

Professionals as defined above may use their company's forms and letterhead to make the certifications. Appraisers and Compliance Inspectors are to use the Compliance Inspection Report, form HUD-92051. The individual signing Section II must be the person who actually performed the inspection. Section III or IV, as appropriate, is to be signed by the Direct Endorsement Underwriter.


Mortgagee Certification: When a Mortgagee Certification is used to clear minor conditions the HUD-92051 is not required.

Mechanical Certifications: Please see: Heating & Electrical section of this manual.


5. Refinances: Standard refinances require a complete appraisal with deficiencies and repair conditions reported. Although HUD does not require completion of the repairs on a streamline refinance, except lead-based paint repairs, the lender may require completion of repairs. A streamline refinance may be insured with or without an appraisal. Please see:Handbook 4155.1, Rev. 4 Chapter 1


6. Appliances: The Valuation Protocol (page D-26 of Appendix D, Handbook 4150.2) requires the appraiser to note the appliances that are present in the home at the time of inspection and whether the appliance is considered personal property or part of the real estate. The protocol further directs the appraiser to treat non-functioning appliances/equipment as deferred maintenance in the valuation process.

The manner in which an appliance is attached to the dwelling would determine whether or not an appliance should be considered part of the real estate. In some real estate markets, it may be typical and customary for certain appliances to convey with the real estate. In these situations, those appliances should be considered real estate and treated as such in the valuation of the property.

In some cases, such as that of REO properties, all or some of the appliances may be missing and there may be damage to the floor, wall or ceiling finish as a result of the removal. Depending upon the magnitude of the damage, the appraiser is expected to treat the damage to the home as deferred maintenance and reflect such in the conclusion of value. Missing appliances must be addressed by the appraiser in the valuation process, particularly when the comparable sales included a full complement of working appliances.

In cases where appliances are missing and minor repairs may also be needed, lenders are encouraged to have the borrower take advantage of the Streamlined 203(k) loan product, which has no minimum repair cost threshold and is designed to cover such improvements/replacements.

To find out more about a specific scenario you can access the Homeowner Center Reference Guide directly on HUD's website. You may have a faster response by contacting David Krushinsky directly at 602-695-7575 or david.krushinsky@wjbradley.com.

By now, most of you have heard of the $8,000 tax credit available to first time homebuyers purchasing a primary residence in Phoenix before December 1, 2009. The question that seems to be on everyone's mind is whether or not the money can be obtained sooner and if so, what can it be used towards? There have been many announcements and subsequent revisions that have made it all a little confusing. Here is a breakdown of some of the current policies set forth.

At the end of May 2009, HUD announced that it will allow "monetization" of the tax credit. This simply means that the anticipated tax credit can be applied towards the purchase of the home immediately rather than waiting to receive the refund. The guidelines authorize the monetization in a few different ways.

For starters, homebuyers that believe they qualify for the credit are permitted to reduce their income tax withholdings. This will allow buyers to accumulate more cash reserves for a down payment by increasing their take home pay. Individuals must be cautious because if the purchase does not occur, the IRS could impose interest and penalty charges on the repayment.

Some state housing finance agencies and other government entities have introduced programs that will provide homebuyers with short-term loans that can be used towards the FHA minimum 3.5% down payment. Longer term loans that are secured by a second lien on the property are also permitted. The National Council of State Housing Agencies (NCSHA) has compiled a list of such programs that can be found at http://www.ncsha.org/section.cfm/3/34/2920. At this time, Arizona does not have any of these programs available.

In addition, FHA approved lenders are allowed to provide bridge financing to the buyer that is secured by the anticipated tax credit. This amount is permitted to cover closing costs, prepaid expenses and down payments above the FHA minimum of 3.5%. Unfortunately, there are no lenders participating in such programs at this time. The broad consensus in the industry is that these loans are not anticipated to surface in the near future. For additional questions contact David Krushinsky at 602-695-7575 or david.krushinsky@wjbradley.com.

With Phoenix home prices at an all time low, first-time homebuyers are in a prime position to maximize their opportunities in today's real estate market, especially with the authorization of the $8,000 tax credit by the American Recovery and Reinvestment Act of 2009. The following is a brief summary of some of the key factors.

•1. The tax credit is equal to 10% of the purchase price up to a maximum credit amount of $8,000.

•2. Applies to "first-time homebuyers", which is classified as a buyer that has not owned a primary residence in the last three years.

•3. Residence must be purchased after January 1, 2009 and before December 1, 2009.

•4. Any single family residence, including condos and townhouses are eligible.

•5. The full credit amount is available to individuals with an AGI less than $75,000 ($150,000 for joint return). There is a phase out period for an AGI up to $95,000 ($170,000 for joint return).

•6. The tax credit is refundable. The credit amount is used to reduce or eliminate the tax liability and the remaining balance is then refunded to the purchaser.

•7. The credit does not have to be repaid unless the home is sold within three years of purchase. Then the entire credit amount is recaptured upon the sale.

At the end of May 2009, HUD authorized the tax credit to be utilized to cover closing costs and prepaid expenses through state housing authorities, FHA approved non-profit agencies and bridge financing. However, at this time there does not appear to be any lender participation in this type of loan. For additional questions contact David Krushinsky at 602-695-7575 or david.krushinsky@wjbradley.com.

The foreclosure market in Phoenix has sparked national attention and caused a dramatic increase in home sales. According to an article published by the Arizona Republic, investors trying to reap the benefits of the bargain priced foreclosures jump started the area's housing market in the first part of 2009. In April, investors consisted of approximately 19 percent of the Valley's home sales. Recently, the new front runner's for home purchases belongs to Phoenix first-time homebuyers.

Market analysts believe that first-time homebuyers will soon account for half of the area's home purchases. It is said that the federal housing plan's $8,000 tax credit to first-time homebuyers and other neighborhood stabilization programs are providing huge incentives to help people purchase these foreclosure homes as primary residences.

The major increase in purchases is for residences priced below $150,000. Many of these properties are receiving multiple offers, which are helping the overall prices to climb. Today the median home price in the Valley is $116,500, which is up 1.3 percent since the end of April. The median price per square foot also increased 2.4 percent, reaching $84.86 per square foot in May.

Where investors dominated the market during the housing boom, accounting for 35 to 40 percent of Phoenix home sales, today lends a very different housing market. Investors are either paying cash or being forced to contribute large down payments in order to receive financing. Mortgage financing is more favorable to individuals purchasing primary residences and placing larger requirements on investors to deter potential future foreclosures.

If you are thinking of purchasing your first home......NOW is the time to seize all of the opportunities available!!! Contact David Krushinsky today at 602-695-7575 or david.krushinsky@wjbradley.com.