The Fed’s Buying – How About You?

March 22, 2009

Info from this week’s Mortgage Market Guide:

ben_s_bernanke

Last week, the Fed used their regularly scheduled meeting to make a blockbuster announcement.

Over the course of 2009, the Fed will purchase an additional $750 billion of mortgage-backed securities, as well as $300 billion in long-term Treasuries, primarily to help shore up the housing market and keep home loan rates low. On the announcement, bonds exploded higher, leaving bond prices within whiskers of the best levels ever.

How does this really impact home loan rates?

While the Fed’s actions may keep mortgage rates from moving higher, they may not cause them to move dramatically lower. The Fed’s actions create demand for mortgage-backed securities, which should help keep the ceiling on home loan rates from moving much higher in the foreseeable future. That’s good news for homebuyers who are seeing the bargains out there and understand that now is the time to act.

But – and this is very important – what actually happens to mortgage rates depends on which bond coupons the Fed purchases. If they purchase higher rate coupons – as they have done so far this year – their continued purchasing will likely keep a lid on rates, but not necessarily push them significantly lower. Additionally, due to many understaffed lenders and investors currently working at maximum capacity, we could once again see that improvements in pricing may not all be passed through to borrowers.

usamcashAnother factor that could impact whether mortgage rates see significant improvement are concerns of future inflation brought on by all the recent aggressive moves by the Fed. While we know there is little inflation at the present time, chatter about future inflation could have a negative impact on home loan rates, or at least stifle any improvements.

Although the media is already spinning it differently, this is not a time to stay on the fence, hoping and waiting for lower rates. Home loan rates remain within inches of all-time historic lows, but may not necessarily move significantly lower, so waiting could be a risky move.

Also, an update on Mark-to-Market – the accounting rule which has had a devastating impact on the financial markets: The Financial Accounting Standards Board (FASB) agreed that it will propose to allow companies to use more “leeway” in applying the accounting rules they use to value their assets, and planned a final vote for April 2. If this rule change is approved, it could result in better first-quarter financial statements for companies that have been affected by this rule. Stocks have been moving higher lately in the hopes that Mark-to-Market will be fixed, and a resolution could help stocks further improve.

Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty
Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com

It’s Good To Have A Friend In The Business®
samson-realty-and-bird

If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.

4 – 4.5% Listings with First-Class Service — Cash Back to My Buyers!


Tips for First-Time Northern Virginia Buyers

March 20, 2009

pricedownReductions in Northern Virginia home prices, and unprecedented low interest rates for mortgages, have combined to offer tremendous opportunities for renters to become homeowners. The prospect of making the change may be exciting, but also overwhelming.

Here are a few common mistakes to avoid:

hud-logoNot understanding the home buying process. Educate yourself. Find a homebuyer seminar that you can attend, or research online. The U.S. Department of Housing and Urban Development has an entire section devoted to first-time homebuyers, information on mortgage programs, downloadable tools such as a “wish list” and home-shopping checklist, tips on selecting a real estate professional, and so on. Another good source is a solid lender such as Wells Fargo or  Prosperity Mortgage whose websites offer consumers a variety of tools and resources on purchasing a home.

housequestionNot asking questions. There are many intricacies to the home buying process, and even though you can gain a basic knowledge on your own, you will still have questions. Be sure to tell your real estate professional that you are new to the process. Choose an agent (like me!) who is willing to spend time with you and walk you through the entire process. A good agent will expect you to have questions at each step – from house-hunting, to making an offer, to the closing (such as, “What the heck is a closing?”). This is one of the largest financial transactions of your life, so you want to have a clear understanding of what’s going on at all times.

Looking outside your price range. Before beginning your home search, get pre-approved by a mortgage professional – preferably one you know or one recommended by your agent – to get an idea of how much you may be able to borrow. Use this information as a starting point in determining your price range. Then take into consideration other factors that will affect your monthly budget once you are a homeowner, such as property taxes, homeowners insurance, utilities, and maintenance. Don’t go out looking at homes before you have a firm idea of your range.

Buying on impulse. Don’t feel pressured into making an offer on the first home you see. Buyers, especially first-timers, may be impressed by the first two or three homes they view. Look at a good selection, then narrow the prospects to a select few and return for a closer look. When you decide to make an offer, work with your agent to get all of your questions answered first. But don’t wait too long to make an offer. The longer you wait, the greater the chance other prospective buyers may place offers, making it harder for you to negotiate a good deal.

storkNot planning ahead. Think about personal changes you are planning in the next five years. For instance, are you starting a family, and if so, is the home large enough and will it continue to be? If you think you’ll be relocating in a few years, you’ll probably want to pay closer attention to potential appreciation and resale value. If two incomes are needed to qualify for financing or to make your payments, do your plans include the ability to sustain those incomes?

Failure to consider location. Don’t just focus on the house. Examine the community. Does it suit your lifestyle? Is the area safe, well-maintained, close to work, stores and schools? Find out about zoning and whether new construction is planned on vacant land in the immediate area. Also consider the potential market for resale in the future. Your agent can also help with that.

    Above all, remember knowledge is key. No question is silly. Your agent and your mortgage professional are invaluable assets throughout the process, and they want you to succeed. Making smart home buying decisions will make the home-buying process less scary and your first home purchase a rewarding experience.


    February 2009 Northern Virginia Sales Info

    March 15, 2009

    graphFebruary 2009 home sales activity for Fairfax and Arlington counties, the cities of Alexandria, Fairfax and Falls Church and the towns of Vienna, Herndon and Clifton:

    A total of 1,067 homes sold in February 2009, a 10 % increase above February 2008 home sales of 969.

    Active listings decreased by 18 % from last year, with 7,811 active listings in February, compared with 9,497 homes available in February 2008. The average days on market (DOM) for homes in February 2009  to 109 days, compared with 116 days in February 2008.

    The average sales price in February fell by 21 % from February 2008, to $380,077, compared with last February’s average of $479,320. The median sales price of homes sold in Northern Virginia in February was $318,000, which is a decline of 23 % compared with February 2008’s median price of $410,500.

    The February pending home sales data, based on signed contracts, is bucking the national trend – 1,817 contracts are pending compared to February 2008 when 1,526 were pending, an increase of 19 %.

    febstats


    It’s Big Johnson Basketball Time Again !!

    March 11, 2009

    It’s once again that time . . . bigjohnson

     . . . when people all over the country stop doing what they are doing and feverishly consider their picks for the NCAA Basketball Tournaments so they can enter the SEVENTH Annual Big Johnson COED College Basketball Tournament Classic, sponsored by yours truly. 

    newshuffleStick It To The Man – that’s me! A NEW 4GB Apple iPod Shuffle (in your choice of silver or black ) awaits the winner of EACH of the Men’s and Women’s Big Johnsons! (YOUR gender is irrelevant. I am referring to the separate basketball tournaments.) If you win, and you happen to already have an iPod – or other music player (ptui!) – I’ll give you the equivalent in iTunes credit, if you prefer. I would suggest that you check out the NEW Shuffle carefully before you decide. And as usual, anyone who gets more points than The Man will win something. Last time it was a king-sized Snickers bar. Can’t beat chocolate . . .

    ti82It won’t cost you anything but your sanity . . . and not even that, if you just choose the higher-seeded team in each matchup, and then pick the eventual Final Four winner based on their mascot or school colors. How difficult can this really be? Well, there might be upsets. Or not. And gee, there are only – uh, lessee, 64 teams in each tournament, where’s my TI-82? – okay, 126 total games.

    And it takes a special kind of person to enter BOTH the Men’s and Women’s tournaments. Yes, I mean you!

    The brackets are being set by the NCAA (Men’s Sunday March 15; Women’s Monday March 16). The men’s first round games start on Thursday March 19 (we don’t do the men’s “play-in” game on Tuesday), and the women’s on Saturday March 21 – and the brackets are locked shortly before the first game of each tournament. That doesn’t leave you much time, so GET GOING!

    The Group Name on ESPN is “Big Johnson” for each tournament, and the group password is: kimsentme. That’s right, kim sent me, one word.

    espn_logo

    You can get there through the following URLs:

       Men’s Tournament Challenge:  http://games.espn.go.com/tcmen/frontpage

       Women’s Tournament Challenge:  http://games.espn.go.com/tcwomen/frontpage

    I know some of you like to fake out ESPN with an alias and throwaway email, but please be sure I can identify you from your name or the name of your entry. Otherwise I will keep your iPod, ha ha. 

    After you create your entries, be sure to join the Big Johnson group in each tournament! And, if you create your entry before the brackets are set, be sure to return in time to choose your winners before they lock. Most people will wait until March 17 or 18, but don’t forget! ESPN tracks your points as the tournaments progress. I will weigh in every now and then with a Big Johnson update note.

    FRIENDS ARE WELCOME, so you can forward this if you wish. Just be sure they identify themselves to me!

    Best of luck to everyone!

              Kim

    Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty
    Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com

    It’s Good To Have A Friend In The Business®
    samson-realty-and-bird

    If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.

    4 – 4.5% Listings with First-Class Service — Cash Back to My Buyers!


    Why Is The Buyer’s Agent Paid By The Seller?

    March 5, 2009

    housequestionIt’s a strange arrangement. Here I am, the agent for the buyer, receiving my compensation from a party who not only is not my client, but whose interests are (one would think) directly opposed to those of my client – the seller. They want the highest possible price, my client wants the lowest. They don’t want to spend money on repairs, my client wants the repairs made. The list goes on. The two sides are in agreement on one thing only – they want the transaction to happen. Yet it it almost universal for the seller to pay the buyer’s agent. Huh?

    This seemingly oddball arrangement exists for a couple of reasons. First, the historical background: until the mid-1990s, real estate brokers and agents operated under subagency agreements, whereby brokers listed property, and offered cooperative commissions to other brokers bringing in buyers for the listed property. Under subagency, these cooperating brokers and agents were legally bound to represent the seller.

    conmanDespite this fact, most buyers thought “their” agent represented them, and acted accordingly, often to their detriment. By sharing how much they were willing to pay, when they had to buy, or how much they loved the home, they unwittingly provided the seller with useful negotiating information. Eventually the Federal Trade Commission put pressure on the states to have real estate agents disclose to consumers exactly whom they represent. Most states eventually adopted disclosure laws, and the industry adapted by creating buyer agency arrangements (similar to sellers’ listing agreements). But the existing commission arrangement remains in place – the seller still pays. Why?

    no_moneytranspThe reason that sellers still pay the commission is because the main obstacle to buyers being able to buy is a lack of cash – cash for the down payment, cash for closing costs, cash for the move, cash for furnishings, and the list goes on. It takes a long time to save that money. Some people find it difficult; others find it impossible. Add the buyer’s agent commission, and the seller will have fewer buyers available.

    The seller is receiving cash from the sale. If they pay the commission, more potential buyers are able to afford this property. The more potential buyers, the higher the likely sales price. The higher sales price provides the incentive for the sellers to pay the buyer’s agent in addition to paying their own.

    There are “exclusive buyer agents” who accept their payment only from their buyer client and refuse the seller’s offer. They argue that the only way for a buyer to be certain to avoid any conflict of interest is to avoid firms that both list and sell homes, and to compensate their own agent. In practice, I have never been tempted to change my buyer representation perspective regardless of the offered compensation. I disclose to my buyer clients the compensation offered on every property, and have on occasion used higher compensation levels to assist my clients in the purchase.

    Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty
    Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com

    It’s Good To Have A Friend In The Business®
    samson-realty-and-bird

    If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.

    4 – 4.5% Listings with First-Class Service — Cash Back to My Buyers!


    Buyers — Read This First!

    March 4, 2009

     

    houseThinking About Buying A Home?

     

    Wonderful idea . . . if you do it the right way.

    kimh_006cutout

    Step 1:   Find a Great Agent.

    Step 2:   Relax.  We’ve got your great agent right here. (see photo –>)

    Yes, You Want and Need an Agent!

    Look, I just want to find a house to buy. I can look on the Internet. Why would I need an agent?

    Many think the buyer’s agent’s job is to say, “Here is the kitchen.”  Or that it’s about looking in the MLS to find the buyer a property they like. Or that it’s making showing appointments with listing agents and sellers. Yes, we do that, but the real job of a buyer’s agent is to find you the best property for your needs given your circumstances, and get you the best possible bargain on it, and get you through the maze of legal and contractual tasks you’ll have to do to complete the purchase.

    But couldn’t I just use the seller’s agent?

    This is what is known as a big mistake. The seller’s agent and the seller have an agreement specifying the responsibilities of the agent. All of their legal responsibilities are to the seller. They are working for the seller, not for you, and they have a contractual obligation to sell that property at the highest possible price, on the seller’s best terms.signpaper

    The buyer’s interests don’t enter into it. The sellers’ agents don’t care if you could buy a better property for less, or get a better deal on this one, and they don’t care about any potential problems or issues with the neighborhood or the home itself, now or later.

    The seller and his agent know more about the property than you. A good buyer’s agent can fill that information gap. They spot issues that buyers need to know about before they make an offer. When you get to negotiations, a buyer’s agent has been watching what’s been sold in the area recently. You haven’t—and you’re not going to get in now. A buyer’s agent keeps your interests front and center.

    If the seller’s agent convinces you that he can represent you as well as the seller—a situation known as “dual agency,” which is legal in Virginia but not everywhere—you have to ask yourself:  What happens when the interests of the seller and buyer diverge, as they usually and naturally do? In that situation, the agent can’t do much more than back slowly out of the room, shut the door, and let the parties fend for themselves. Have fun … 

    checkbookHow much does a buyer’s agent cost?

    The quick and easy answer is … nothing!  Wow!  What a deal!

    That is correct. The listing contract calls for the seller to pay the seller’s agent a set percentage of the sales price, and share that amount with the buyer’s agent, if there is one. If there isn’t, the seller’s agent gets to keep it all. Of course, the only person bringing money to the table is the buyer, so in that sense the buyer is paying it all—whether they have an agent, or not.

    So, not using a buyer’s agent is not going to save you any money—and remember, you certainly aren’t going to get as good a deal, and may wind up making a huge mistake on the most important financial decision of your life. Why not get what you are paying for?

    What’s this “cash back to the buyer” thing?

    moneybag

    Just another one of Samson Realty’s little improvements to the way business is done in the local real estate industry. What we do is offer the buyers we represent a rebate of 0.5% of the sales price, if the buyer agent commission is at least 3%. While there is no standard, about 90% of commissions offered are in that range.

    On a $400,000 purchase, that would be $2,000 to you. It’s our experience that most buyers, especially first-time buyers, are short of cash, and every little bit helps!

    Aside from the commission having to be 3% or better, the only other caveat is that there are sometimes limits imposed by your mortgage company on the amount of seller subsidy and other incentives you can accept, which might curtail the rebate in some cases.

    I’d be happy to answer real estate questions for you with no charge and no pressure. Email me, phone me, or check my blog – updated regularly with all kinds of interesting stuff – at

    It’s Good To Have A Friend In The Business

    Tips for Buyers

    Can you afford to buy a home? Did you know that paying rent can be more expensive in the long run? When you pay rent, your money is gone forever. But when you make mortgage payments you build equity in your home. Your home may also appreciate in value, often faster than the rate of inflation. Property taxes and mortgage interest paid on your personal residence are usually 100% tax deductible, and profits on the sale of your home are often tax-free. There are numerous advantages to owning a home. Here are some things to consider when buying your first home:

    Credit and Affordability

    preapprove

    Get a copy of your credit report. Most lenders will get a credit report and review it with you as part of their pre-approval process. The sooner you do this the better. If your credit report contains items that need correcting, you’ll want to fix them before you make an offer on a home. Many web sites offer calculators that help you determine how much home you can afford. Many of these use standard debt ratios of 28/36, meaning that your housing payments cannot exceed 28% of your gross income and that your total debt cannot exceed 36% of your gross income. However, depending on your assets, credit history and earning potential, you may qualify for more than what the standard debt ratio calculations would indicate. Contact a lender such as Prosperity MortgageFirst Savings Mortgage, orWells Fargo Home Mortgage to determine how much you can afford. These lenders are backed by strong banks, they know the best programs, and best of all, they’re nice people that I know personally.

    Down Payment?

    Buyers often assume they need to save 10-20% of the purchase price before they can buy a home. While most loan programs require cash for the down payment and closing costs, some allow 95-100% financing, and often the sellers can contribute closing costs.

    Other Considerations

    In addition to your mortgage payment, you will also pay for property taxes and homeowners insurance. If you buy a condominium you’ll likely pay a monthly condo fee. Could your requirements change? Will you have a larger or smaller family in the near future? Will you some day need a home office or work area? Consider how your needs may change in the next several years.

    Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty
    Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com

    It’s Good To Have A Friend In The Business®
    samson-realty-and-bird

    If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.

    4 – 4.5% Listings with First-Class Service — Cash Back To Home Buyers!


    Foreclosure Pricing – Real or Pretend?

    February 21, 2009

    Excerpt from one of my favorite Real Estate bloggers, Kris Berg in San Diego:

    wheelofWe are finding ourselves spending a whole lot of time explaining lender pricing methods to buyers. This week we saw another bank-owned listing priced a full 20% below one active listing and two in escrow – all identical homes within two blocks of the perpetrator. Now, one can argue this is a brilliant strategy for ensuring a speedy-quick sale, and one might even argue that the price will tend to float toward something more in line with true values. Both arguments are valid, but is blatant and gross under-pricing moving toward an ethical gray area? And, what about an agent’s fiduciary responsibilities? Lenders are clients, if not people, too, and pricing a property using a dreidel could be considered negligent. Finally, there is the confusion among buyers that this causes.

    Pretend prices – This is what the prices we see attached to many of the foreclosure homes on the market actually are. Most of these homes are knee-deep in offers numbering double-digits before the sun goes down on the first day of showings. Unfortunately, this is a difficult concept to explain to buyers. “Yes, the home is priced exactly at the amount for which you are approved and, no, you cannot buy it.” This is a bitter, even seemingly incredulous message to swallow, and so often a buyer will need to go through the exercise once or twice before they take my word for it.

    There is a bigger issue  . . . the one of uber-low pretend prices becoming a popular “lead generation” tool for the agents representing the listings. In a world where buyers are doing their own searches, a too-good-to-be-true carrot can sure make that phone ring. And it leaves the rest of us who use real numbers with a lot of explaining to do.

    Read the whole post at the San Diego Home Blog  – Kris’s writing is pretty good, by the way.

    This is happening here too. Buyers call me excitedly about a home they have seen in their real-estate-search-engine-of-choice, supposedly in their price range – “Wow! Can we go see this one NOW???” Sure. If you can get past the hordes of other buyers waving offers. You can make an offer, too . . . and let me show you the “escalation clause” addendum, because you are going to need it.

    No such thing as a free lunch.

    Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty
    Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com

    It’s Good To Have A Friend In The Business®
    samson-realty-and-bird

    If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.

    4 – 4.5% Listings with First-Class Service


    Organizing Can Be An Emotional Thing

    February 16, 2009

    messydeskStuff. Most of us have waaaaay too much of it. If you know my wife, you will understand who keeps stuff organized in our house. She spent a good part of this weekend moving cookbooks, camera and various electronic gizmos from one cabinet to another, tossing things we haven’t been using, and getting some new things put away. It’s certainly not me – you should see my desk right now. I am not the best person to talk about decluttering, though it’s definitely a mantra of mine when talking to sellers! So that’s why I asked for professional help in writing this piece, and Aimee Saldivar obliged:

    tmntDo you feel bad throwing out every greeting card you receive? Or do you feel the need to save every toy your children owned to hand down to their children someday? Keeping these toys and remembrances can add up, especially if you don’t have the space to store them. If you save the toys’ original boxes or perhaps the toys that are slightly tattered, they’ll be of no value if your children decide to buy their kids new toys altogether. Get rid of them! One way to keep that precious toy close to your heart is to take a picture of it and create a digital album for you and your children to cherish tomorrow. Those pictures would make a great hardback album for a holiday gift, or can be used to create a scrapbook. It will not only take up less room, be cost effective and environmentally friendly, but it will allow more room for you to use today.

    walshI recently finished a book by Peter Walsh, professional organizer and motivational speaker, called “It’s All Too Much: An Easy Plan For Living a Richer Life With Less Stuff.” He makes some great points about happiness: more material things don’t really measure success, having more possessions may be more suffocating than liberating, and the stuff we own ends up owning us. When we feel like we have too much stuff, we buy more containers; but in reality we aren’t cleaning out clutter, we’re just storing it away. Eventually this will build up and take over our space.

    We have more winter ahead of us, but it’s a great time to start planning our organization. Here are few ideas to get you started without being overwhelmed by the task:

    1. One room at a time. Focus on a room rather than your entire home. A smaller goal cuts down your anxiety and helps you stay focused. Prioritize each room according to either your budget or the time you have to spend. This will help you plan your project more effectively and will keep you on track to organizational success.
    2. Think about what you want to achieve out of that room. If you’re planning to put your home on the market, you may want to consult a professional stager or organizer to create a “punch list.” An extra set of eyes can’t hurt, and they know creative ways to minimize clutter and maximize your sale price without going overboard. If you’re looking simply to organize, store away those keepsakes into one box you can bring out when you want to reflect, and keep the room livable without feeling cramped and cluttered.
    3. consignTIP:  In today’s economy, second-hand and consignment stores are becoming the hot place to shop. If have you some great items that you feel guilty about giving away, consignment shops are a great way to get rid of them without having to host a yard sale or post them in the classifieds online. Remember, one man’s junk can be another man’s treasure – at less than half the price! [Followup tip from Kim:  Drop off your stuff and drive away quickly, or you will come home with more than you took in!]
    4. If you haven’t used in the last year – GET RID OF IT! Some things we own may be seasonal items, which is okay; however, if you’re still thinking that the one item you’re saving may go back in style, dump it. If it comes back someday, there will plenty of options to choose from. Many times we get so wrapped up in how much we paid or how much we saved on a particular item when, in reality, it was probably an impulse buy at the time. We may also keep something “in case we need it.” Unless you are talking about fire extinguishers and the like, if we haven’t used it in a year, then we don’t need it, and we’ve probably forgotten about it.
    5. books1TIP:  Getting rid of dust collectors such as books, lampshades and dried flowers can help alleviate dust for people with allergies. You may continue to dust the shelves, but not the books on the shelves or the dried flowers you are saving from a special occasion. It rarely occurs to people that dust build-up on these items is overlooked and can make matters worse for people with allergies. Once you finish reading a book, trade it for a new one or donate it. Donating books to your local public library is a very simple process and is a tax write-off for you next year.
    6. The more you can eliminate, the better. Linen closets become an emotional trap for us since they house blankets and linens we don’t want to part with. This is usually where Grandma’s hankies and table linens end up. Instead, think about storing them in a dedicated keepsake box from Grandma, or framing and hanging them in a guest bedroom (if they go with the theme). Once you make room for the linens you actually use, you won’t have to shuffle through mismatched sheet sets and torn towels. If you have different sizes of sheet sets for different rooms and/or family members, a great way to keep them organized  is to color-code them. Buy a different color of two-inch grosgrain ribbon rolls for each size or family member to keep the sheet sets together for “grab and go.” It adds a nice touch to your linen closet, too. NOTE:  When you have your home on the market, prospective buyers look through everything, especially closets – they’ll be impressed.
    7. medalsA great way to pay tribute to a loved one after they have passed would be to dedicate a space or a room for their items. If they were in the military, one way to pay tribute would be to frame their military medals along with their uniform jacket. Or if you are having a hard time parting with their collected items, perhaps you could sell them and donate the money in their memory to an organization or educational institution they would have appreciated.

    ladybugsoMany thanks to Aimee Saldivar, professional organizer and home stager. She also offers special occasion set-up such as table setting and arranging. You can find before and after pictures on Facebook by looking up Ladybug Staging and Organization.

    If you mention this article, Aimee will provide a free consultation when you sign up for a service. Plan ahead and call today for an estimate at 703-856-3404 or email ladybugstaging@gmail.com.

    Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty
    Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com
    It’s Good To Have A Friend In The Business®

    samson-realty-and-bird

    If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.

    4 – 4.5% Listings with First-Class Service


    Ready To Be Stimulized?

    February 15, 2009

    capitolIt’s a fine mess when Mr. Language Man has to make up words (“stimulized?”). But it’s a pretty messy bill our elected representatives just passed. I’m sure President O would have just preferred to get $800 bill to spend as he needed, when he needed, on whatever he thinks will work. But, nooooo.

    I am sure there will be no shortage of articles and blogs on this subject. Still, since I want you to read my blog, here’s a summary of some of the provisions that might be of interest to you:

    hometaxcreditRefundable First-time Home Buyer Credit. Last year, Congress provided taxpayers with a refundable tax credit that was equivalent to an interest-free loan equal to 10 percent of the purchase of a home (up to $7,500) by first-time home buyers. The provision applies to homes purchased on or after April 9, 2008 and before July 1, 2009. Taxpayers receiving this tax credit are currently required to repay any amount received under this provision back to the government over 15 years in equal installments, or, if earlier, when the home is sold. The credit phases out for taxpayers with adjusted gross income in excess of $75,000 ($150,000 in the case of a joint return). “Refundable” means that even if you don’t owe any taxes at all, or owe less than the amount of the credit, you will receive the difference in cash after filing.

    The new bill eliminates the repayment obligation for taxpayers that purchase homes after January 1, 2009, increases the maximum value of the credit to $8,000 ($4,000 for a married person filing separately), and removes the prohibition on financing by mortgage revenue bonds, and extends the availability of the credit for homes purchased before December 1, 2009. The provision would retain the credit recapture if the house is sold within three years of purchase.

    Another important change for our area: reinstatement of the increased conforming loan limits for high cost areas. You may recall that our local conforming loan limits rose from $417,000 to $729,750 last year, giving purchasers of higher end homes an important break on interest rates for loan limits up to that amount. At the end of 2008, the temporary limit expired and it dropped to $625,500. This stimulus bill reinstates that $729,750, which should make it easier to get larger loans which now qualify for Fannie, Freddie and possibly FHA guidelines, which translates to lower rates.

    newcarSales Tax Deduction for Vehicle Purchases. The bill provides all taxpayers with a deduction for State and local sales and excise taxes paid on the purchase of new cars, light truck, recreational vehicles, and motorcycles through 2009. This deduction is subject to a phase-out for taxpayers with adjusted gross income in excess of $125,000 ($250,000 in the case of a joint return).

    energyauditTax Credits for Energy-Efficient Improvements to Existing Homes. The bill would extend the tax credits for improvements to energy-efficient existing homes through 2010. Under current law, individuals are allowed a tax credit equal to ten percent (10%) of the amount paid or incurred by the taxpayer for qualified energy efficiency improvements installed during the taxable year. This tax credit is capped at $50 for any advanced main air circulating fan, $150 for any qualified natural gas, propane, oil furnace or hot water boiler, and $300 for any item of energy-efficient building property. For 2009 and 2010, the bill would increase the amount of the tax credit to thirty percent (30%) of the amount paid or incurred by the taxpayer for qualified energy efficiency improvements during the taxable year. The bill would also eliminate the property-by-property dollar caps on this tax credit and provide an aggregate $1,500 cap on all property qualifying for the credit.

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    “American Opportunity” Education Tax Credit. The bill would provide financial assistance for individuals seeking a college education. For 2009 and 2010, the bill would provide taxpayers with a new “American Opportunity” tax credit of up to $2,500 of the cost of tuition and related expenses paid during the taxable year. Under this new tax credit, taxpayers will receive a tax credit based on one hundred percent (100%) of the first $2,000 of tuition and related expenses (including books) paid during the taxable year and twenty-five percent (25%) of the next $2,000 of tuition and related expenses paid during the taxable year. Forty percent (40%) of the credit would be refundable. “Refundable” means that even if you don’t owe any taxes at all, or owe less than the amount of the credit, you will receive up to 40% of the credit in cash after filing. This tax credit will be subject to a phase-out for taxpayers with adjusted gross income in excess of $80,000 ($160,000 for married couples filing jointly).

    A fairly decent 19-page PDF summary of the whole bill – THE AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 – is available from the Senate Finance Committee website.

    Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty
    Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com

    samson-realty-and-birdIt’s Good To Have A Friend In The Business®

    If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.

    4 – 4.5% Listings with First-Class Service


    Looking for A Mortgage Lender?

    February 14, 2009

    You’re thinking about buying a home, but you can’t pay all cash. Gee, join the least-exclusive club we know! Now you have to get a loan secured by whatever home you want to buy, a loan we call a mortgage.

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    You Lose!

    “Oh, I’ll just click on one of those ubiquitous pop-up Internet ads, and lenders will come begging for my business!”  Please, please, don’t! Whether it’s the one where lenders advertise their “best rates,” or the one where you ask for four lender quotes (and get hundreds of them calling you day and night), they won’t be any good at this point. What you need to know first is what loans are available to you, and how much house you can afford based upon those loans. You want someone who will tell you what’s going on in the loan market right now.

    You are not ready to sign up for any loan yet. Instead, you are trying to find a loan officer who will be there when you are ready. Will they guide you through the process, and explain how they get from A to B? Taking your income as a starting point, they would subtract from that your current monthly obligations, to arrive at a reasonable monthly budget for housing, using current interest rates, tax and insurance costs. As for what kind of mortgages, they should start with a fully amortized 30-year fixed-rate mortgage with no more than one point of combined origination and/or discount fees. (A “point” is 1 percent of the mortgage amount.) They should then discuss alternative loan types, such as the 5/1 adjustable (see below), but the main purpose here is to ensure you will not be getting in over your head.

    You might like the numbers the first lender gives you, but don’t stop looking. You want to have this same discussion with at least three different loan officers. You need to confirm that what you’re hearing is the truth, both in terms of what you can afford and the likelihood that the loan terms are valid. You see, loan officers in general have an incentive to tell you what you want to hear, and despite the existence of a “Good Faith Estimate” and/or “Truth in Lending” documents, they don’t have to deliver what they promise unless and until they provide a loan quote guarantee or “lock.”

    What kinds of loans are out there that are worth considering? In the current interest rate environment, where rates are historically low, forget negative amortization (where you pay less interest than the actual loan rate, and the underpaid interest is then added to the loan balance). And forget “teaser” loans, where the first couple of years is at an artificially low rate, like 1.25%. Both of these are sure recipes for disaster – they were the cause of many of the foreclosures we are going through right now.

    All the rest have their advantages and disadvantages. The fixed rate loan is almost always at a higher rate. In effect, it’s 30 years of insurance against rate changes. Yet most people either move or refinance in 5 years or less, so why would they pay for a 30-year guarantee? The 5/1 (or 3/1, 7/1, or 10/1) ARM – where the rate is fixed for the first several years and adjusts annually after that – is usually a lower rate.

    And why spend money “buying down” your interest rate by paying discount points, if you’re not likely to keep it long enough to recover the money? You might cut your monthly interest charge, but it takes 6-8 years to break even.

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    Once you have believable info on how much you can afford, then you can start looking at properties. Stay in touch with the lenders you believe would be most reliable. You’ll notice I said “lenders” – keep reading.

    You might want to strongly consider having a backup loan. When you’ve decided who your first choice lender will be, ask the next best lender if they will be your backup. They might, if they don’t think the first lender can deliver. If they’re right, you’ll be signing their paperwork at the end. You will need to do everything necessary so that both loans are ready to go. The backup loan is useless to you if it’s not ready to go at the same time as the main one. You may have to pay for an extra appraisal, but it’s $300 or so well spent.

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    If you decide not to have a backup loan, you will have to sign whatever papers your one lender gives you, whether they deliver on their promises or not – you won’t have a choice unless you decide to renege on your purchase contract, which can be extremely expensive, as you can imagine.

    Having said all that, I have only been involved in one settlement where the buyer had a backup loan waiting in case the first one fell through (it didn’t). Most of my buyer clients have used mortgage officers I knew would deliver. I have seen a couple of situations where the settlement (my sellers) was delayed because the buyers’ lender was incompetent or untruthful, and it’s not a pleasant place to be for anyone.

    UPDATE: Here is a great post about What To Look For In A Mortgage Lender