Wednesday, July 20, 2011

Valuable Appliance Longevity Report Every Home Owner Must Have

Have you ever thought about the life expectancy of your household appliances? How about the materials used to build your home? Well, if you are like many home owners today, you probably haven't given it much thought at all. I mean, who really needs to know how long the shingles on the roof are going to last, anyway, right? But, that is just the point; there are some things, you, the home owner, need to know.

Whether you are buying a home or thinking of selling your home, it is important to understand the estimated life expectancy of all your appliances and other home materials. Buying or selling a house without factoring in the cost to fix aging materials can cost you in the long run.

There are many factors involved that can age a household appliance like a refrigerator or building material such as siding.

• Weather
• Maintenance
• How an item is used.

Here are some examples depending on above factors:
• A refrigerator may last up to 13 years.
• Cooks, - your kitchen cabinets have a life expectancy of 50 years.
• Outdoor lovers, your outside deck has only a life span of 20 years.
• Vinyl Siding will last for the lifetime of the house, and
• Your wood floor will endure for 100 years. Of course, all under ideal circumstances.

The NAHB, National Association of Home Builders released a report in 2007 entitled, "Study of Life Expectancy of Home Components." They list appliances, building materials, as well as other components you may never have thought about. The comprehensive report is only 19 pages long yet boasts as a worthy read of any home owner or potential buyer.

Let me know, as always, how I can help!


Silicon Valley Specialist
Local Real Estate resources
Silicon Valley Market Trends

Thursday, July 14, 2011

Do you rent out one of your properties?

Reporting is now easier for mom-and-pop landlords.

I had send earlier in the year an email to all my clients who rented out a property, to alert them about a new IRS reporting requirement.

Good news: this has changed, for the better. Here is how:

Households that find renters for a second property but are not in the business of real estate don’t have to send an IRS Form 1099 to vendors if the vendors do more than $600 worth of work in a year. Landlords have faced the 1099 reporting requirement for a while, and that requirement continues to apply to them, but last year the requirement was extended to households and entities that rent out property as a sideline but are not in the rental housing trade.

The National Association of Realtors and others strongly opposed that expansion and succeeded in persuading lawmakers to repeal it, which Congress did.

President Obama signed the repeal into law in late April, so, now the requirement applies as it always has: just to those in the business of real estate.

Francis Rolland

Silicon Valley real estate

Tuesday, July 12, 2011

Study: Homeowners Who Default on Mortgage Alone Not a Credit Risk

Today, many homeowners who defaulted on their mortgage payments have asked the question, "Will my mortgage delinquencies make me a higher credit risk to lenders?"
Good question.
On the surface, it is obvious that falling behind and becoming consistently delinquent on any bill is not a financially sound thing to do. However, your credit rating may not be as tarnished as some would leave you to believe.

A homeowner needs to consider what establishes poor credit and good credit in the eyes of the lender. Surprisingly enough, if you have other debt that you are in good standing with, such as credit cards or an auto loan, you will be less likely deemed as a credit risk. Those who have defaulted on their mortgage payment as well as other accounts are higher risks to a lending institution. The study below reveals why.

Mortgage-Only Defaulters

Transunion. , a global leader in credit and information management, released a study which stated, "...consumers who only defaulted on their mortgage during the economic recession were far better risks than those consumers who went delinquent on multiple credit accounts." This particular study explained that consumers, who were only default with their mortgage payment, displayed stronger ability to stay current with other loans.
"There appears to be a pocket of opportunity among mortgage-only defaulters that is not the result of excess liquidity, but rather the unique circumstances of the recent recession," said Steve Chaouki, group vice president in TransUnion's financial services business unit. "This new market segment that the recession created is an important one for lenders to understand. They have the potential, today, to be stronger and more reliable customers."
Breaking it down…
• The lack of cash flow that resulted in defaulted mortgage payments does not by itself make the consumer “high risk” to a lender.
• You are a risk if you have multiple delinquencies on other accounts including the mortgage.
• You are not a risk if you have mortgage-only defaults but are current with other debt, such as a car loan or credit card.

In conclusion, if you are a mortgage-only defaulter you have more hope than those who are not and should not consider yourself a high risk. For more information, here is the link again to the Transunion study Mortgage-only Defaulters.

Let me know, as always, how I can help!

Silicon Valley Specialist
Local _Real Estate resources
Silicon Valley Market Trends

Thursday, July 7, 2011

Refinancing problems? here is a suggestion...

Are you trying to refinance but you cannot because your equity is too low?

This is the classic catch 22 in which you cannot take advantage of great rates because the bank’s appraisal is too low.

The HARP refinancing program is addressing precisely this need. HARP: Home Affordable Refinance Program, administered by Fannie Mae and Freddie Mac.

Good News !!
Set to expire June 30, 2011, this program has been extended one year. In 2010, Fannie Mae and Freddie Mac purchased or guaranteed more than 6.8 million refinanced mortgages. Of this total, 621,800 were HARP refinances with Loan-To-Values between 80 percent and 125 percent !! This is more than 3 times the number in 2009.
Some limitations apply of course, but fairly reasonable.  One of them, for instance, is that you need to spend more than 31% of your pre-tax income on your mortgage payment. (thank you Nicolas!  ;-)  for the input). Check out the details on the Freddie Mac web site, or the Fannie Mae web site:  Fannie Mae web site.

Another program worthy of noting if you have financial problems: the "Making Home Affordable" Program.

Thanks for reading!

Silicon Valley real estate
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Saturday, July 2, 2011

Some perspective on the Silicon Valley market....

Some recent headlines turned heads and generated a lot of questions among my clients recently, headlines such as: “Case-Schiller Down 5.1%; What Will Stop It?” and “The Depressing State of Housing”.

What is really going on in the Valley? I find that chosen graphs speak much better than headlines. Comparison of the first 5 months of last year, with the same months this year, for the Counties of Santa Clara and San Mateo:

This graph shows roughly the same movement as last year. If anything, it shows a better situation, since we do not have in 2011 the government incentives for 1st time homebuyers that we had in 2010 (Calif. 1st time homebuyers credits, and federal incentives). These created last year a rush to buy before June, which does not exist in 2011.

Comparison charts for Sunnyvale and Mountain View:

Comparison charts for Los Altos and Palo Alto:

Average prices can vary  a lot from month to month.  These charts just show that overall the market is fairly the same as last year, at the very least.
Thanks for reading!

Mortgage rates: Week ending 6/23/2011:  - 30-yr. fixed: 4.50 fees/points: 0.8%   - 15-yr. fixed: 3.69 fees/points: 0.7%    -  1-yr. adjustable: 2.99% Fees/points: 0.5%  (Source: Freddie Mac)

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