Bridget Fredericks

Hello to all the potential home buyers out there. I know there's so much going on in the news right now, it's hard to know what to believe. So let's hope this blog post can clear up some of the confusion.

First, let's talk about interest rates. Yep, you've seen it. Someone, somewhere has advertised a rate of 4.6%, 4.8%, 4.4%, etc. How do you know what your rate will be? Well, unless you talk with a lender, you won't know. First of all, the rate that is typically advertised is the best possible rate. It would typically apply to someone with 800 credit scores, putting at least 20% down for a conventional loan on a primary residence. You see there are a lot of factors that go into determining your rate. So, if your credit scores are in the 675 range, your rate will be higher. Some banks are even charging hits to the rate for people with scores of 700-719. Part of this is the lending industry correcting for past mistakes. So, be prepared if your rate is higher than the rate that plastered all over billboards all over town. And remember, if rates weren't so low to start with, then with the added hits, your rate could be even higher - so you're still getting the deal of a lifetime with respect to interest rates. Rates remain at the lowest levels that they've been at in 30 years!

The tax credit - $8,000 - up for grabs. Ok, so first, this applies to a first time home buyer which is someone who hasn't owned a principal residence in the past three years. How cool is that? So if you did own a home, five years ago but haven't since then then, presto bingo, you're a first time home buyer again!

Second, there are income limits so you may or may not qualify for the entire $8,000.

Thirdly, you may have heard a lot of noise about FHA saying that you'll be able to use the tax credit in advance of receipt of the money. Well, they put the cart before the horse on this one. While they may still figure out a way to make it work there isn't anything that I'm aware of YET to make this a reality. So, for now, you need 3.5% for a downpayment and you may file for the tax credit when you file your tax returns next year. That's still pretty good... getting $8k back from Uncle Sam!

P.S. I did hear a rumor that Louisiana was working on a putting a mechanism in place for you to get use of that tax credit up front as your downpayment. But at this point, I have to question if the beauracracy can get something in place before the 12/1/09 deadline expires. My suggestion is - DON'T WAIT - MOVE NOW. Go ahead and make that move now. Take advantage of this phenomenal buying opportunity, Now!

If you want more information about the tax credit, I suggest that you talk to your CPA and take a look at the website.

That's all for now. I'm sure things will keep changing daily so keep looking out for new information as it hits the streets!

Wow! I just haven't had time to write in a long time. But let me update you on some interesting issues that we are facing when processing sales in today's lending environment.

First, let me start by saying that here in Baton Rouge, LA we have a remarkably healthy real estate market. Properties are moving. We've had a couple of properties with multiple offers. And there seems to be a healthy supply of inventory and buyers. Having said that, this means that we have been selling. And in selling, we've seen a few interesting things pop up!

For investors: Keep your reciepts! If you purchase a home to fix it up and sell it quickly - especially if you got a great deal on the purchase - keep your reciepts. We've noticed that the buyer's lenders are asking for those receipts to justify the increase in value. Now, I, personally, am not fond of this. I think the lender should trust the appraisal to determine value. And it concerns me if underwrters are now placing a value on the improvements made to a property. But despite that, this is the world we live in. This should be an issue if you double the value in less than a year and the buyer is getting an FHA loan. However, we've seen this issue pop up even when the property did not "double" in value. So keep those receipts and be prepared to deal with this issue if it pops up.

Here's the other item that's seeping it's way into our perfect little world. It's a thing the underwriter calls an "inducement to purchase." In some parts of the country, I've heard that sellers are giving away cars, cruises, vacations, etc as an inducement to the buyer to purchase their property. This is not the case in Baton Rouge, but we are feeling the effects of this down here. So how does this affect us now? If you have a purchase agreement that states that a "washer and dryer will remain at no value," the underwriter will ignor the "at no value" clause and subtract the value of those items from the purchase. In fact, I'm dealing with this right now!

I can't believe a common household appliance would be considered an inducment to purchase. And quite frankly, I'm concerned at where this stops? It starts with a washer/dryer, then a how about a dishwasher, a stove, the toilets, etc. It's a slippery slope is all I'm saying, but it's one that we don't have any control over. These rules are dictated by Fannie Mae. For now, just be aware that these items are probably better left off the purchase agreement and sold separately to the buyer from the seller. And keep an eye out for what Washington, D.C. does. As unemployment rises in other parts of the country, rules and laws that they implement may have further affects on us.

On the bright side our unemployment rate is much better off than the national average and we've actually seen job growth in Louisiana. That's all for today. If you're considering a move, let me know!

I know lots of us like to get advice from someone who we trust greatly before making big decsions. In fact, it's perfectly normal. But there's a right way and a wrong way to do this. So, if you are a buyer or seller and you plan to make a move soon and want the advice of an uncle, an aunt, a parent, or other trusty advisor this article is for you!

First, I assume that you want your advisor involved either because they are older/wiser than you are or because they have purchased and sold more real estate than you or both. These are good reasons. I know that when I make big decisions I still like to get my parents' input because they are wiser (we won't call them "older" because they get sensitive to that "old" stuff). Realistically, I know that they have had their opportunities to make mistakes so why not learn from their mistakes instead of having to make my own!

When you get started, bring your advisor(s) to your first meeting with your REALTOR. It's important for a couple of reasons. First, "who" you select to represent you in your real estate transaction is your first BIG decisions. Let your advisor(s) meet that person and help you determine if your real estate agent is as good as you think they are. This is the first big step you'll take.

If you are selling a home, your advisor(s) won't be needed again until you get an offer. When your agent makes the appointment to discuss the offer with you, be sure to schedule it so that your advisor(s) is there as well. All the questions can be asked at one time and your family member and your REALTOR can work together to help you achieve your goal. It is key that everyone is working together to help you!

If you are buying a home, I suggest that your family member view the homes with you. Most buyers tend to buy on emotion. You will have the added benefit of your advisor giving you a less emotional opinion of each home as you see it, in conjunction with your REALTOR's opnion in terms of values, quality, and resale. Once again, everyone is working together to help you achieve your goal.

By being sure to have your chosen advisor with you each step of the way, you eliminate some trouble for you. I've seen before a thousand times. A buyer picks out the prettiest house from the whole lot, brings Auntie Em who has bought and sold apartments for a living and the very excited buyer who just loves the home they chose asks Auntie Em what she thinks and ole Auntie says, "Well, it's ok, but I'm sure you could do better." If only Auntie Em had seen the other 10 houses that were awful, then she, too, would know what a great home the buyer had chosen.

The entire process of buying or selling a home can be a big undertaking. This is just one tip to make it a little less stressful for you and a little easier. The whole process is one big education, so leaving someone as important as your advisor out of one of the loops can hurt the process for you. So bring them along for everything. And you'll get better, more helpful advice from your friends/family.

Whew! I finally have a few moments to sit down and make a blog post.  I think this is my first post of 2009.  I know we're only 6 days into the new year, but I feel like I've accomplished 30 days worth of work.  So, let's talk about the local real estate market.  I won't have stats for January until January is completed, but I can tell you what's going on in my office.  I have met and showed homes to 3 new buyers since 12/31/08.  I have written contracts for all three buyers.  One of the buyers was competing with other offers on the house he wanted, and - of course - my client's offer is the one the seller accepted.  I have a 4th new buyer that I'm showing homes to this evening.  And a 5th new buyer arriving in town on the 20th of this month.  Plus, a 6th buyer that will be ready to look at homes around the middle of the month.

The other factor is, clearly, interest rates.  Rates are lower than they've ever been and they may be lower than they ever will be.  This has definitley helped some buyers move up their timelines to purchase.  A couple of the people that I'm working with now had planned to wait until summer to move, but the super low rates have inspired them to act on those plans now.

So, if you are considering a move.  Now is the best time.  Even with all the business I'm working right now, I'm never busy enough!  I want to help as many people as I can in 2009, so I'm off to a good start.  But if you or someone you know is considering a move, give me call and we'll help you plan your process.

As the new year approaches, I know that there are many people out there considering a move in 2009.  Now is the time to start getting all your little duckies in a row.  This is a good place to start.

First you want to start your reseach.  Most people today start their research on the Web, and here you are!  I must warn you though.  There are many sites out there doling out free information to the consumer and many of these sites are giving you misinformation.  So, gather some information on the Web, and then be prepared to meet with your REALTOR.

Whether you are selling or buying a home or both, you'll probably want to interview a few agents.  Most people do interview agents to list their home for sale.  But most people don't do themselves the same due dilligence when purchasing a home.  Now, you might think, "What's the big deal who helps me.  I know how to buy a home."  Sure you do.  But, an experienced agent can help you shave off a lot of time and stress in searching for your home.  An experienced agent will also help you prioritize and strategize your offer so that your purchase works best to your favor.  So, take the time to interview buyer's agents and find out what they are going to do to help you through this process and save you from the heartache of the failed transaction or overpaying for a home.

Investor Note: If you are planning to purchase an investment property, an experienced agent will save you a lot of time.  An experienced agent can rule out bad investments on paper before you even have to see the house, likewise that same agent may be able to spot a real gem for you as soon as it comes on the market.

Next, you'll have to select the agent or agents who you want to help you with your move.  Great agents will work together to help your sale and purchase dates work together seamlessly.  This is yet another skill that help keep you from having to live in a motel as is the case when the dates don't come together just right.

It's never too early to start your plan.  Let's say you want to move next November.  Your agent can help you prepare your home for sale.  Sometimes it may take time to get ready, so knowing ahead of time what needs to be done can save you some last minute stress.  If you are making a purchase later in the year, knowing the financial part of your transaction now may certainly help you to prepare for the money you may need for a downpayment or to clear up any errors on your credit report.

So, as the New Year sneaks up on us now is the time to start planning so that we may achieve those New Year's Goals!

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