Jim Cheney Your Rincon Valley Realtor

I recently read a post written by an agent in Hawaii, who suggested potential sellers and buyers only work with "Full Time Real Estate Agents". I have nothing against "Full Time Real Estate Agents" My question is what is a full time real estate agent?

Do you become a full time real estate agent by being at the brokerage from 8 to 5pm? Because I know some agents at my brokerage who seem to be there night a day, and to tell you the truth, I'm not sure they've completed more than a couple of transactions for 2009. Is it the number of transaction sides you close that makes you a full time agent, or is it the dollar volume? I know a couple of agents who just do mobile homes, and they are busy! but I bet their annual income is below that of the some of the high end agents who do 1/3 the work.

What about the pest inspector, contractor, or appraiser who has a real estate license. I know some agents who have been in the inspeciton business for years, and were recently licensed. What about licensed property managers who spend most of their time dealing with rentals?

I think the real questions is, are you trained, qualified, and have sufficient experience. How do you find this out? I'd ask for two things. How many transaction side have you represented this year? In the past 3 years? Do you have any past clients I can talk to?

The question "Are you a full time real estate agent" doesn't really give a potential client enough information to make a decision.

Sonoma County is home to lots of famous people, Fred MacMurray, Harry Morgan, Charles Schulz, Robert Ripley, Raymond Burr, Joe Montana and more. Although fun to see, and claim as local residents, none have left an impact on the county as Luther Burbank.

Luther Burbank was a botanist and horticulturist who came to America from England he developed a better potato call the Burbank Potato. Burbank sold the rights to his potato and $150 and used the money to travel to America, where he settled in Santa Rosa at age 26. He found Santa Rosa to have the perfect growing season, weather, and soils. Burbank used his home and an experimental garden in Sebastopol to create and improve over 800 species of flowers, fruits and vegetables. Some of his better known varieties are:

• The Burbank potato
• Spineless cactus
• shasta daisy
• Santa Rosa plum

He died in 1926 at age 77. The Santa Rosa rose parade was in honor of all Luther Burbankcontributed to Sonoma County. March 7^this celebrated in California as Arbor day which is Luther Burbank's birthday.

Luther Burbanks house is a registered California landmark. It is free to come walk around and visit the garden. Tours of the house are available for a small donation.

The gardens are open daily in the winter 8 - 5pm and summer 8 -7pm.

I have a client now, and have had clients in the past, who want to know whether or not they should pay points to buy down their loan. First of all, let me say that I'm not a mortgage broker, and don't pretend to do lending. I believe I should do what I do best, and let other professionals do what they do best. Also, what I'm explaining here is a principle, so don't blog me back saying that you can beat this rate, and ask my client to call you.

What is a buydown?

1. It is paying money upfront to the lender to get a better interest rate. This money is in addition to the money needed to get your loan. You might get preapproved for a 5.12% loan, but by paying an extra $2,500 you could get a 5% loan. The amount paid is referred to as points. One point is equal to one percentage point. One point on a $300,000 loan would be $3000. A half point would be $1500, and a quarter point would be $750. Your lender will tell you how many points or fractions of a point you would have to pay to buydown your interest rate aka: buydown your loan.

Why buydown a rate?

1. Buying down a rate makes the amount you end up spending at the end of your loan (lets say 30 years) less. You could save tens of thousands of dollars in interest by buying down a loan.
2. Buying down your loan may mean the difference between qualifying for a loan, and not qualifying. The numbers used to decide if you qualify on a loan is based on the amount of monthly payment, not necessarily the the amount borrowed. If buying your loan down lowers your payment by a few hundred dollars that may make the difference in your "qualifying figures". It's is possible you could qualify for a mortgage with a $1470. mortgage, but not qualify if the amount was $1820. Buying down the loan might be what makes the difference.

Why would a bank want me to buydown my interest rate:

1. Banks want you to borrow money. If you don't qualify at a certain rate, the bank offers a better deal if you are willing to pay "upfront". You get your loan, and the bank gets your business. Without buydowns, a lot of banks would not be able make loans to some people who were unable to qualify.
2. THE BANK MAKES MONEY! I know it sounds crazy, but the bank stands to make more money on you by letting you buy down your interest rate. This sounds a bit contrary to what I said earlier when I said you could save tens of thousands of dollars over the life of your loan but think about this. The average family sells every 8 years. They refinance even more frequently. If you refinance or sell shortly after getting your loan, you will never see the benefits of the savings, and the bank wins by keeping the money you used to buydown your loan.

Is it worth it?

1. Here's how to figure out if buying down your loan makes sense.

You qualify for a 30 year fix rate loan of $100,000 at 5.12%, that would equal a monthly payment of $544.18 You can pay 1/4 point to buy down to 5% for the same loan. The 1/4 point (or .25%) will cost you $250. Your new payment would be $536.82. The difference in the two loans is $7.26.

It cost you $250 to save $7.26 each month. How many months would it take before you break even? Divide $7.26 into $250 and you get just a bit ove 34 months. So you will need to keep your loan for almost 3 years before you start seeing any savings. How much would you save during the course of the loan if you kept it for 30 years... ???

So that's it. Easy to figure out with basic math. You just need to understand the concept. It's hard for an agent to know if you should buy down your loan, unless you won't qualify without the buy down, then the question is easy. The real question is: Do you need to, and will you keep your loan long enough to see the reward? Oh, the money you would have saved? $2,649.

I was driving down the road about a month ago and saw these  three stacks on the side of the road in a field that use to have a horse.  I thought, what the hell are those?  Underground ventilation?  State water testing? 

Then a few nights later...

Looking for a reason to visit the Wine Country this weekend. Let me give you 11!

20th Lisa Lampanelli; 7:00 pm - 9:00 pm; Queen of Mean with her no-holds-barred, insult comedy routine. 7 p.m. $42.75. Wells Fargo Center for the Arts, Santa Rosa. 546-3600. www.wellsfargocenterarts.org.

20th - Possessions of Mrs. Jones;6th St Playhouse; 8pm $15 - $25; Evelyn Jones lives in a shiny happy suburban fantasy. But when God and Satan emerge from her washing machine to enlist her help in preventing a hostile corporate takeover of Heaven and Hades, Evelyn begins to unravel.523-4185. www.6thstreetplayhouse.com

20th - 22nd PAC WEST BARREL RACING; Sonoma County Fairgrounds Lyttle Cow Palace Santa Rosa; Grab the Cash Gala
50 Guaranteed $33,490 Open Barrel Race, $1,000 Added Futurity, Jockey and Pro Slot Races707-751-0396
Website: www.pacwestbarrelracing.com

21st Vintage Holiday Boutique; 9am - 3pm; FREE; Open Door Church, Petaluma; Holiday Craft Show featuring all local artists and their handcrafted holiday and home décor, jewelry, handbags, clothing, baked goods and lots more. carneyjane@netzero.net

21nd - Dec 2nd Annual Holiday Hors d'oeuvres Party $25; 6 -8pm; Sbragia Family Vineyard Geyserville; Holiday, Celebration: Come celebrate the holidays and taste some great hors d'oeuvres paired beautifully with our wines, while listening to music. Everyone attending the party will get to take home all the recipes along with suggested wine pairings. Perfect for the Holiday Season! RSVP required. 9990 Dry Creek Road, Geyserville
(707) 473.2992 x10

2st Louis Foppiano Celebrates 99thBirthdayCelebration; $20; 11am - 4pm; Attendees will be able to step back in time as they enjoy a retrospective tasting of Petite Sirah along with a special tribute to Louis J. at noon. They will also have a peek into Foppiano's future as they meet winemaker Natalie West and taste her future releases. 12707 Old Redwood Highway, Healdsburg
(707) 433.7272

21st Ceremony of Carols ; $10-$15; Glaser Center Santa Rosa; Santa Rosa Symphonic Chorus, led by Dan Earl, will kick off its 75th anniversary season with a glorious performance.527-4999. ext. 9228.

21st - 22nd Holiday in Carneros ; $40; 10am - 4pm; Holiday, Celebration: Join more than 20 Carneros wineries for this fun winery open house weekend. Sample and purchase great wines, enjoy tasty treats, browse interesting arts and crafts, listen to lively music, meet the winemakers and winery owners and much, much more! Admission includes a Holiday in Carneros logo glass and access to all the fun! Proceeds fund scholarships at Santa Rosa Junior College and Napa Valley College. (800) 909.4352

21st &22nd St. Josephs Crafts Fair; FREE; 10am - 4pm;St. Joseph Church Hall Cotati; Featuring local crafts and crafters.Continental breakfast and Turkey Luncheon, hourly raffles, Gifts Baskets, a silent auction and cash drawing. A kids corner and pictures with Santa. 795-4807 x109. www.stjosephcotati.org.

22nd Free day at the Charles Schulz museum;all day; FREE; Celebrate Charles Schulz's birthday by visiting the Museum Enjoy ice cream cake from Cold Stone Creamery from 1-3PM

22nd Ursuline Bingo; 18yrs +; 4pm; Ursuline Gym; Supports scholarships. All games pay $250 including early birds. Weekly specials. Chance to win $350 and $500. Criss Cross, Flashcards and more! Great snack Bar. 18 & up only. Newcomers welcome. Doors open at 4 p.m. Games at 6:45 p.m. 524-4646 ext. 142. www.ursulinehs.org.