Holy HUD Headache
Recently I sold a Home to a Client in The Greater Oakland County Mi. That was a HUD Home and boy how things have changed just in the last few years. I knew going into this was going to be somewhat of a “Pain” and in doing these in the past few years it was not really a surprise, back not so long ago as a Realtor you usually had to deal with these and Short Sales to survive in the business. Thinking, as we do, getting our Bid excepted was a milestone in the business of dealing with HUD properties but this is as far from the truth now more than ever. It can seem like a very lonely process getting the things done that need to be completed so that you have covered the bases and have given your Home Buyer the best representation as possible and they deserve. To me one of the most important things when representing your Home Buyer in a HUD property is to let them know the facts up-front and to try as best you can to explain how the process works both negative and positive aspects of purchasing a HUD Home and the responsibility they share with you to assure that the process is followed so they are protected, and if it’s the first HUD Sale of a Realtor then they need to get answers if they are unsure. Not knowing or just guessing for your HUD Buyer can have a detrimental effect on them and could possibly lead to them losing their EMD (Earnest Money Deposit) and worse for them, losing the home they wanted. As with all Home Purchases the HUD Buyer has the right to hold or have a private inspection but this is only for their own information as HUD Homes are SOLD AS IS and if the HUD Buyer backs out they will lose their EMD or forfeit it. Try to make sure your HUD Buyer puts the minimal down that’s required by HUD, this information can be found in the HUD Packages supplied by the HUD Bank once the Bid has been accepted. Another heads up. Not all HUDS are the same. They can have different contracts and contingencies just like any other home. As always, be sure to read the contract first and make sure your HUD Buyer understands.
Additionally, on the HUDHomeStore Website linked here, it states that “HUD strongly urges every potential homebuyer to get a professional inspection prior to submitting an offer to purchase”, But some HUD Home Buyers want to move quickly as to not losing the property to another Bid. In my particular situation the HUD Buyer wanted to move on her Bid and get the Inspection after it was accepted. Be prepared to have not only the City Inspectors, Building Inspectors, Plumbing Inspectors and Electrical Inspectors visit the property before closing which can take a lot of your time and especially patience, but it is your duty to be there as the HUD Buyer is not allowed to be at the property during or at any time alone, this happening can cause your buyer to lose the deal, EMD and could cost you a fine! Be prepared for the work that a great agent must do, and don’t be surprised of the little if not no help from HUD or the Listing Broker, you will seem alone but always remember your goal is for your client and doing the best you can do for them. HUD Homes are a headache but also can be a reward to you and your HUD Buyer in the long run and you may find it worth it to put and go the extra mile or in this case miles.
Other Helpful Information
• Only primary residence buyers are allowed in the first round of bidding.
• If the home is being offered as eligible for FHA financing it:
– Has an existing FHA appraisal that must be used (unless expired) AND
– The sales price has usually been based on the existing appraised value. Bidding above the sales price may result in paying the difference out-of-pocket between the bid and appraised value.
• HUD does not automatically provide title insurance. This could be an additional expense, so inquire to avoid surprises at closing. Only if HUD has agreed to pay closing costs, could the insurance be provided at HUD’s expense.
• If HUD is offering a repair escrow, this amount can be added to an FHA loan, but HUD doesn’t pay for it.
• Lender documents must be to the title company up to 10 days prior to closing date in some states. Make sure that there is enough time to meet this requirement.
• HUD signs closing packages first. Then once the loan proceeds and the title company receives buyer down payment and closing costs, the buyer is allowed to sign.
• Closing delays are common due to “title clearing” issues. Foreclosed homes can have several liens due to utilities, taxes; etc that must be dealt with before closing can take place. Discuss potential challenges, such as rescheduling of moving trucks, and possible rate lock extension fees.
10 Tips to Help You Save Home Energy – Oakland County Mi
Before you spend money on the latest energy-efficient gizmo that’s supposed to save you money, let’s look at some energy saving ideas that will really help you save home energy. The strategies that we will look at will maximize the effort you put in, and help reduce your home energy consumption.
First sit down and think about all the different ways your family uses energy around the house. Now put an approximate type and cost of energy used. You may have trouble breaking down the cost but try to do it. Now all you have to do is find ways to save on your resources at the same time cut your costs. You may have to think creatively but it can be done.
So here are some tips to get you started:
– Turn the lights off when you’re not using them. This is really simple and easy to do. Do you really need your bedroom light on when you’re in the living room? Do you leave lights on when you leave the house? Do you even need more than one light on in a room for what you are doing? Believe it or not it makes a big difference.
– Turn all electronics and other appliances off when you’re not using them. No one can do everything at the same time. Can you really listen to a radio, watch television, and use your computer all at the same time?
– Set your thermostat down a couple of degrees in winter, or up in summer, to conserve energy. And dress appropriately indoors for the time of year it is. For instance in winter, put on a sweater or some extra clothing, or may snuggle under a blanket to stay warm. In the summer, wear less and stay cooler naturally.
– Only turn an appliance on when you have a full load. This is true especially for the washing machine, dryer and even the dishwasher. It is amazing how much extra energy is used doing multiple small loads in comparison to one full load.
– Do regular maintenance on your appliances. Keeping them clean means they don’t have to work as hard. Changing filters reduces the energy needed to accomplish a task. Regular care will also mean any maintenance bills that you might come up against may well be cheaper.
– Be careful how you use your water. Like when brushing your teeth or washing your hands, use only the water you need. Don’t let the water run the entire time. Also, try and use less water if you take a bath, or control your shower times.
– Simply let your hair air dry, instead of using a blow drier every day.
– Lower the temperature on your water heater to 120 degrees F.
Don’t forget the bigger projects as well.
– Seal the cracks around your doors and windows. You are paying for your hot air that escapes through cracks all around your house. You need to make sure you are doing all you can to keep the warm air you’re paying for inside your house.
– You also need to check your house’s insulation. Though this has been done by many homeowners nevertheless you still need to do it before you pass it over. It is probably the biggest thing in reducing heating costs.
Now some of these things may seem trivial to you but let me assure you that even the small things add up over time. And really most of them you won’t even notice the difference to your life except your bills.
These tips and suggestions will make your home more affordable, and take some strain off of our world’s resources. Just think if all of us would make a few of these changes, it would make a huge difference.
by: Dave McIntosh
User Friendly Designs in Your Home are both attractive to future Home Buyers and can even add additional value. Whether elderly or handicapped you don’t have to e either to enjoy and appreciate the designs manufacturers are coming up with to make life easier. As a Realtor in the Greater Oakland County Mi area I have seen many things that are new in homes and some of them amaze me and I always think “What a Great Idea” and as always I see more and more of these user friendly designs that make life easier for home owners.Most homeowners have a list of things they would like to do to change and improve their homes.
But moving those plans off the list and into reality is often prevented by costs, especially for labor, but some of these can be in-expensive and can make life a whole lot easier. Lets face it, we aren’t getting any younger nor has life become less stressful with more and more to do, so when we are home making it user friendly can be one of the most beneficial, in-expensive and a value add for many years to come. Below are some of the things I have seen that make for a user friendly home to enjoy for years to come. I hope this help and gives ideas for Home Buyers, Home Sellers and Home Owners to consider when they want to make their homes more user friendly.
Some of these things can be found in pharmacies and home department stores. For other ideas, browse through specialty catalogs.
- refrigerators with adjustable-height slide-out shelves to eliminate bending and reaching
- lettering on controls and instructions large enough to read without squinting or hunting down a pair of glasses
- non-skid cutting boards
- contoured knife handles requiring less pressure to cut food
- playing-card shufflers
- tabletop book and newspaper holders
- lamps that turns on and off by touching their base or clapping
- lever adapters on faucets and doors to make opening and closing easier
- bent-handled hairbrushes and long-handled bath brushes
- easy-grip, spring-band scissors that open by themselves after you snip
- Velcro fasteners on shoes
- needle threaders
- large-numbered, lighted key-pads for telephones
- swivel seats to ease getting in and out of a chair
- motorized chairs that lift you to your feet.
Buyers Beware Easements Impact, Recently I sold a HUD Home to a client in the Greater Oakland County area, a nice home not one you would picture in your mind as a HUD Home. The home was a beautiful tri-level in a fantastic area and seemed to be priced very well and a great value. The home is on a beautiful wooded lot with many trees and a wonderful waterfall pond in the yard, there was also this large shed with a canopy style roof to sit under during sunny days or warm summer nights. Inspection time, the City came out and my buyer was told that the beautiful shed had to either be torn down or moved at her own expense. The previous owners had built this shed under and around the utilities easement also without a permit from the City.Although there are many other types of Easements that can be disclosed by a private Seller, when it comes to buying a HUD Home make sure to have a City Building Inspector come to determine if there are any other easements that you are not made aware of. I want to share the importance of Buyers Beware Easements Impact on properties and have share my thoughts here for all potential Home Buyers.
Buyers Beware Easements Impact if you are thinking about buying a property that comes with an easement, be sure you understand how it could affect your life and the property’s value. An easement means a third party has been granted the right to use a defined area of an owner’s property for a general or specific purpose (see box). Easement restrictions could, for example, prevent you from building on the easement area or from installing fencing that would prevent access to or through it.
There are many different types of easements. A common one—a right-of-way easement—allows a specific person or persons to travel across a piece of land owned by someone else. This type of easement is sometimes used in rural areas so farmers or ranchers can get to a piece of property they own that does not have road frontage.
Easements may be granted as permanent arrangements that continue indefinitely or until a release is given by the person receiving the easement. In this case, the easement would normally become part of the property deed.
An easement can also be granted as a limited-time agreement—expiring at a stated time, when a specified event occurs or when the benefiting person dies. Limited-time easements are normally not recorded as part of a deed description.
Other easements you may encounter could grant the right for a utility company to run lines or poles—even high-tension power lines—over, on or under the property, or for a local government or housing development to install sewers or water mains or allow access to a park, for example.
Buyers Beware Easements Impact: Just because an easement is not being used does not mean it will never be used. Should the benefiting party decide to exercise their right, can you live with whatever impact their use might have on your property and lifestyle? Be sure to consult a qualified real estate attorney for advice. In addition, carefully consider whether future buyers will shy away from the property because an easement exists.
Other Common Easements
- Provide pathways across two or more pieces of property.
- Forbid neighbor from blocking view with a wall of trees.
- Allow neighbor to use owner’s driveway to reach neighbor’s home.
- Permit public access to beach or park through private land.
- Grant historic preservation organization rights to enforce alteration restrictions.
- Allow an individual to fish in a privately owned pond.
- Permit land owner to drive cattle over another’s land.
- Restrict development, commercial and industrial uses on a property to preserve views, habitat or other amenities of the land.
- Utilities Easements
Pay Cash Verses Mortgage is a hard decision and could use some good thought and understanding These are questions as a Professional Realtor I face everyday in the Greater Oakland County Mi from some Home Buyers. Pay Cash verses Mortgage can be a tough decision for Home Buyers, and I’m not a financial adviser by far and cannot give that sort of advice to my Home Buyers, it is a question many have. Pay Cash verses Mortgage needs some food for thought and much consideration when deciding either way,
There are ups and downs in deciding to Pay Cash verses Mortgage and wanted to share them to help educate Home Buyers to the differences of both options. I do hope this information is helpful and helps to guide and educated Home Buyers into making the right decision that is best for them. Are you considering paying cash vs a Mortgage for a home? Perhaps you sold a more-expensive home or you’ve received a substantial inheritance. Maybe you have a lifetime of savings stockpiled—or you won the lottery! Being freed-up from a mortgage payment seems like a great idea at first glance. You would have no more worries about missing payments—or having your home foreclosed on. Not having a monthly mortgage payment—usually the largest payment a homeowner makes—could free up monthly income for other purposes.
- The flip side deciding to Pay Cash verses Mortgage that tying up most or all of your cash in your home may not leave you with the flexibility to pay for other things (e.g., college fees, living expenses, healthcare costs) or to respond to emergencies. Although you might later be able to tap your home’s equity with an equity loan or line of credit, doing so takes some time, and you would likely end up paying a higher interest rate than if you had taken out a mortgage to begin with.
- Pay Cash verses Mortgage means you will be lacking a mortgage meaning you would forego the opportunity to shelter some of your income by deducting mortgage interest expenses from taxes.Rather than putting all your cash toward a home purchase, consider a large down payment and an accelerated pay-off plan, such as a shorter-term 10-, 15- or 20-year mortgage. This way, you can use your income to pay off the mortgage sooner, and you still have “liquidity” for other investments and rainy days.
- Big red tax-break flag: If you should decide to take a mortgage out on your home more than 90 days after you purchase it, and you don’t use the money to improve your home, the mortgage would be considered “home equity debt.” In this case, you would only be able to deduct mortgage interest payments on up to $100,000 of your debt ($50,000 if married filing separately).
- When you take a mortgage to purchase a home within 90 days before or after the purchase, it is considered “home acquisition debt”—allowing you to itemize interest-payment deductions on mortgage debt up to $1 million ($500,000 if married filing separately).
- Today’s still-low mortgage interest rates make borrowing inexpensive and paying cash verses mortgage that much more of a challenge. With a mortgage and more freed-up cash, you could put your money into stocks, bonds and other investments that can yield significantly higher returns than what you would save by not paying mortgage interest
- Be sure to consult a financial professional to find out how paying cash or taking a mortgage would impact your unique situation and future plans. You can also get more information at www.IRS.gov; search for Publication 936, Home Mortgage Interest Deduction.
Paying Cash verses Mortgage is a challenging question and it of course is based on every Home Buyers particulate situation. I hope this helps..and remember to seek out a professional Financial Advisory to discuss what is best for you. Happy Home Hunting!