Today's Headlines - Realty Times
Posted On Tuesday, 28 September 2021 00:00 Written by

Lily Tomlin  “The road to success is always under construction.”

Are you preparing to get a mortgage on a home you are about to buy or refinance?  If the mortgage company requires an appraisal on the house, it is good to investigate, inspect, and innovate if needed before spending your money on the appraisal. For example, what needed repairs can you see with the home?  Will the seller agree to pay for getting all the repairs completed?  How much will you need to pay for the repairs? 

Investigate

The home condition can create obstacles to getting the value needed or getting approval from the mortgage company’s underwriting department. For example, appraisers notate repairs that affect the structure, security, and sanitation of the home. Mortgage companies require these types of repairs to be completed before closing.

Inspect

Repairs that affect the structure include rotted wood; foundation problems; roof leaks or missing shingles; peeling paint (especially if the home was built prior to 1978); broken siding; electrical, plumbing, or heating problems; or issues with the air and duct systems.  

Repairs affecting the security of the home include doors that do not operate correctly, broken locks, or open access to the house from outside. 

Repairs pertaining to the home's sanitation include drainage problems, faulty water supply, septic issues; mold; and more.

Most underwriters want the trouble areas corrected before closing, but there are some workarounds when items can be fixed after closing, too.

Innovate

When the repairs must be fixed before closing, the buyer and seller negotiate who will pay for which repairs. If the buyer pays, the mortgage company will have to verify in the borrower’s asset accounts that they have the funds to cover closing and repair costs. If the seller pays, then he or she cannot pay the buyer with a “repair allowance.” Most traditional mortgage programs no longer allow repair allowances or “carpet and paint allowances.” 

In cases like this, the seller could put the money in escrow to be paid to the repair vendor after closing. Some loan programs require the seller to pay one-and-a-half times the amount of the contractor’s bid into the repair escrow account. The extra fifty percent is simply a cushion to make sure, if the repair bill ended up higher than estimated, the seller would have the money to complete repairs. If unused, the extra fifty percent can be paid back to the seller when all the work is complete.

Should weather prevent the job’s completion before closing, the mortgage underwriting guidelines permit certain repair items to be completed after closing. These include landscaping and outdoor painting. In addition, in some locations, the mortgage company can allow the heating and air conditioning to be installed after closing to prevent them from being stolen before the new homeowners move into the property. 

Martin and Maria Miller

Call on resources to repair and get the second home they need

Martin and Maria moved more than a thousand miles from the place where they had lived and built a life with their children. After the kids were older, the couple had an opportunity to take over a business on the other side of the country, and they took it. Later, their children got jobs in different areas of the country. The Martins yearned to have a central rallying place where their family could get together for the holidays and gatherings.

A close family friend from their hometown knew of their desire for a second home in the old neighborhood. This close friend set them up with a realtor who found them a house close to where they once lived. It was beaten up and needed a good cleaning, some carpentry, and a bit of new sheetrock.

Halfway through the loan process, the appraisal came in with a mile-long list of items that could affect the structure, safety, and sanitation on the house. Due to the types of repairs needed, the lender required these repairs to be completed BEFORE closing. 

The Millers realized with a sinking feeling that they had just spent hundreds of dollars on an appraisal and now seemed to be in a catch-22. They could not close on the home until repairs were done, but the seller did not have the money for repairs until after the closing. In so many cases, this is where the bargain deal dies. 

Nevertheless, good friends can be valuable, especially when their trade is fixing and building houses. Their hometown friend got the list of needed repairs and whistled up his construction buddies. Everyone agreed to work for just about free just to help the Millers.  

They put together an itemized agreement to start work when the loan was approved for all but the repairs. The seller signed the agreement that he would pay the hometown friend and his pals on closing day when he got the funds. Once the loan was preapproved by the lender’s underwriter, hometown friend and his pals went to work. The appraiser went back to the house to verify the completed repairs so the Millers could quickly close on their home, where they and the rest of their family could gather together in their former hometown … all thanks to their good-hearted hometown friend … whom they now looked forward to having over for their celebratory dinner!

Posted On Monday, 27 September 2021 00:00 Written by

You always must pay attention when the FED speaks, yesterday the FED spoke and shook the markets. While the move was quick and sharp, the bond market was able to recover the steep loss by the end of the session. The reaction just proves why you must listen to the FED when they speak, and sometimes when they shake up the market the market recovers quickly, other times it starts a trend. Given the news and the thoughts they shared, it won’t be long before the next trend will begin, and it won’t be your friend.

Looking at the news, the “transitory” inflation as they call it has made their inflation prediction to 4.2% from 3.4% just last June. Given the target rate of 2%, even a rosy forecast of 2.2% for 2022 is still higher than the target rate, and is all growth based on a very large number in 2021. In other words, inflation may slow down, but prices are NOT going back down to where they were, no matter what people have said that the market would return once everyone went back to work, and the supply chain was restored. I’m not sure who believes that thought process.

The FED “Dot Chart” a forecast that has always been far from reality when it comes to predicting the future, anticipates 6 or 7 rate hikes through 2024, and with the beginning of the “tapering process” likely to begin shortly, get your refinances in and locked before the opportunity slips away. While rising mortgage rates won’t hurt purchase business all that much as far as total transactions go; it will be a mixed bag of good news and bad news. FHA, VA, USDA, Bond Programs, and down payment assistance loans will come back in style, and while much of the multiple offer situations should dissipate, welcoming back these buyers, don’t be surprised if all cash deals remain strong.

Keys to watch will be the September Jobs report and the inflation report shortly thereafter. These numbers may delay the FED reaction by a month or so; but don’t be surprised if the FED lets the markets figure it out for themselves sooner rather than later! 

Questions or comments: This email address is being protected from spambots. You need JavaScript enabled to view it.

Posted On Tuesday, 28 September 2021 00:00 Written by
Posted On Friday, 24 September 2021 00:00 Written by
Posted On Thursday, 23 September 2021 17:20 Written by
Posted On Wednesday, 22 September 2021 11:23 Written by
Posted On Wednesday, 22 September 2021 00:00 Written by

With about ten weeks to go in the “Production Year”, (loans that will close and pay you before 2022 arrives), I like to throw out a challenge. What can we do, just one simple thing we aren’t doing now, that will generate an extra $25,000 in commissions we can donate to local charities or to families in need in your area? 

We have had solid, if not record-breaking years the past few years, and we should give back, if for nothing more than the fact that you can. At least everyone that makes a commitment to do it can! So here is the challenge. Send me an email, This email address is being protected from spambots. You need JavaScript enabled to view it. and let me know “Challenge Accepted” and what you are going to do, and where you want to target your donation. If you commit to doing the work, I will commit to helping you succeed! I will provide you with an initial coaching call to discuss your plan, provide you Access to my website, and give you email support to work through issues that may come up along the way!

The time to improve ourselves by helping others has come. The money you generate isn’t all that hard to do and won’t change your life all that much; but it will really help those who could really use the help. Besides, if entering this challenge helps you commit to doing something you know you should be doing in the first place, then why not do it now?

So, are you ready to accept the challenge? How many of you out there could we get to accept the challenge, and how much money could we give back to our local communities? Who are the managers and owners willing to accept the challenge? If you have a group of ten or more, you might win a site visit/training and I will come to your office and do a free training for your team to help move the entire group to action!

Posted On Monday, 20 September 2021 00:00 Written by
Posted On Friday, 17 September 2021 00:00 Written by
Posted On Friday, 17 September 2021 00:00 Written by

I want to introduce you to Kate. Kate was just about the sweetest person you could meet. Hard working sales agent, often working long hours and barely making ends meet. 

There were serious reasons for her lack of profitability… 

First there were the personal issues:  Kate was nice, so nice, she let everyone take advantage of her. Her sister-in-law lived in the basement of the home she shared with her husband. He worked, but hours completely opposite of hers. They rarely connected. 

Her small house was also home for her son, his girlfriend, his dog and soon-to-be-born baby. Her son didn’t have a job at the time we worked together, and neither did his girlfriend. They spent their days enjoying video games and watching television while Kate was out making sales. 

Kate often missed dinner due to working long hours. I know this because when we would be in our online session she’d be scraping cold leftovers from the dinner she had made for the family earlier because, as usual, she got home too late to enjoy time relaxing from a full day and enjoying a hot meal. 

I became concerned when she was conducting our zoom sessions in her parked car, even in winter. I asked why and that’s when the flags started shooting up. “I have to be out here because my sister-in-law is on the internet and there is not enough bandwidth for me to handle this call with you.”  Did I mention this family member paid no rent to contribute to the household, and neither did the son, his girlfriend, and their dog? 

I saw a serious problem. 

Kate might as well have had the word “MAT” stamped across her forehead. She just could not stop pleasing everyone else, no matter what the cost to her: her health, cash flow, time, energy, and quality of life.   

Unfortunately, what’s true at home is also true at work. Her staff underperformed but still got paid. She fed leads to others, but never kept track of the status of the leads and their conversions. She had zero operational systems to help track, support, monitor or measure her business. Hundreds of dollars were going out the window for lead generation systems of which she never followed up. She was on full alert for reaction to the latest hiccup with no team or process in place. These “emergencies” took her off dollar productive activities and constantly put her in a high stress, fast reactive mode. 

Her life was a series of putting out fires, grasping for any sales and literally hemorrhaging all the critical resources:  money, time, energy, relationships and joy.  

The clincher was when she told me that her family was planning a short vacation at a beach condominium she owned. Her son and his girlfriend had secretly planned to announce they were getting married, so they took it upon themselves to invite the girlfriend’s parents to join them without asking Kate if that would be okay.  She, of course, had to fund the event, including meals and entertainment, for the entire “vacation.”   

The son’s plan was to announce this upcoming wedding event at this “family reunion,” which would have been a good thing, however,  the couple told her they planned to get married at her house (she would be paying for the wedding, as they had no money, thus why they were living with her).  She soon learned that the fiancé’s parents, the soon to be in-laws, weren’t going to help in any way, but did not hesitate to order lavish catering, flowers and more for the upcoming event. 

Can you spell burnout? 

Burn out was inevitable, both physically and mentally, and clearly financially. 

Now, as a master coach, I know that her mindset was to tough it out, hope it would get better, and hope her family would someday value her love for them, but between you and I, that was never going to happen. 

She had taught them how to treat her. 

She had resigned herself to carrying the entire load herself, bearing the full responsibility for the living of her family, his girlfriend, now a new family- where was this going to end? 

I knew from experience that it would not end well. 

Her pedal to the metal pace was not sustainable long term. At some point she’d either burn out in her business or burn out her body, but either way, burnout was going to happen. 

I also understand her loyalty to her son, but for how long was she going to enable him?

So, help me with this: 

Why is it that women will tough it out and suffer every step of the way instead of taking control of their lives and business? 

• Maybe they avoid confrontation 

• Perhaps they don’t want to release the “disease to please” or risk not being “liked’” 

• They won’t stop long enough to make the changes, fix the issues, create the systems that can correct the course to be in charge instead of out of control. 

Little do they know that the freebie people disappear when the beer is gone. Without loyalty and boundaries and KPI’s, they will stick around ‘til the party's over. 

It’s not about doing for others, it is about building a business to fund your LIFE!

No matter what your business: 

• Systems are the only way to operational excellence 

• Accountability is key to measure and monitor outcomes 

• Strategic plans set the course 

  • Breaking it down to the minutes in a  day can take you to the profit zone. 

Here’s what you can learn from this very true and real situation: 

• You can outwork your tail off and not make the money you want 

• You need systems to keep all the pillars profitable 

• You must hire the right people with the right core values to make the team productive and profitable 

And it all starts with a strategic plan that coordinates with action plans that get plugged into every day, so we are here to share! For your complimentary copy of a Daily Success Plan, email This email address is being protected from spambots. You need JavaScript enabled to view it.

Posted On Wednesday, 15 September 2021 00:00 Written by
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