Five Reasons a Seller May Reject Your Offer

I just read this interesting article on why sellers reject offers. Those folks are Realtor.com are pretty wise.

http://www.realtor.com/blogs/2010/07/16/five-reasons-a-seller-may-reject-your-offer/

Retirement - Social Security is not...

All old Social Security cards had a "NOT FOR IDENTIFICATION" message.
Our Social Security have had that message removed.

Franklin Roosevelt, introduced the Social Security (FICA) Program. He promised:

1.) That participation in the Program would be Completely voluntary,

It's no longer Voluntary


2.) That the participants would only have to pay 1% of the first $1,400 of their annual Incomes into the Program, now 7.65% on the first $90,000


3.) That the money the participants elected to put into the Program would be deductible from their income for tax purposes each year,

No longer tax deductible


4.) That the money the participants put into the independent 'Trust Fund' rather than into the general operating fund, and therefore, would only be used to fund the Social Security Retirement Program, and no other Government program, and, under Lyndon Johnson's "Fair Deal" the money was moved to The General Fund and Spent


5.) That the annuity payments to the retirees would never be taxed as income.

Under William Clinton up to 85% of your Social Security can be Taxed

Since many of us have paid into FICA for years and are now nearing the time when we will be receiving a Social Security check every month and then finding that we are getting taxed on 85% of the money we paid to the Federal government to 'put away.'

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I have never planned on depending on Social Security - it's always been a pipe dream meant for those who have their affairs in order to subsist in times like The Great Depression. As I understand it was supposed to go away in 1968, but was renewed as another governmental income stream.

I just recommend that whoever may be hoping to live off social security will make other plans before they get a rude awakening.

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For me that has been rental homes, even in these tough times people are renting and paying their rent. My rental website is www.robrents.com. I bought primarily around the University of Tennessee, my reasoning was that during good times people send their children to school, during tough times a lot of people go back to school and make it though with school loans and other things like that. The Universities are no longer economical ways to house your students or yourself while you are attending school. I have always loved the area of downtown Knoxville, both North and South, so why not invest in some of the small homes with a ready market.

Investing during the good times has really helped me get through these tough times. I believe that our economy is beginning to pull itself out of this latest "Repression," as I've heard it called. When it does and if government doesn't continue making it nearly impossible for investors to get loans, I recommend you set up your own Independent Security, whether it's rental homes or another self-directed smart small business, it's how my grandparents got through the Depression and it is how we can survive in the future.

Rain Barrels and the city garden

Lowe's put up this cool little video on Rain Barrels and your city garden. I thought others might enjoy.

http://www.lowescreativeideas.com/idea-library/videos/Rain_Barrels_0408.aspx?cm_mmc=email_newsletter-_-weekendprojects_augv2-_-num1-_-num

Excerpt:

Locating the Rain Barrels

To start, choose a location for the barrels. It should be under a downspout in an unobtrusive area, like the backyard. Select a spot that’s level and a little higher than your yard. If you can’t do that, level the ground and position concrete blocks to elevate the barrels. The barrels will have to be high enough to allow you access with a watering can. If needed, you can also attach a small garden hose to the rain barrel spigot to easily fill your watering can.

A great article from Trulia.com on that pesky down payment money.

By Tara-Nicholle Nelson | Broker in San Francisco, CA

Zero down loans are (almost) entirely a thing of the past. While many wanna-be buyers are tucking their down payment pennies away, many of these folks feel that they’re missing out on deals in the meantime!

Here are my top 7 tips for coming up with those critical down payment funds:

Know how much you need to save. We all know that to reach a goal, you have to set a clear target. So, first things first: figure out exactly how much of a down payment you actually need. If you have a credit score of at least 620, you may be able to qualify for an FHA loan that only requires a 3.5% down payment. (For a $200,000 house, that’s $7,000.) Check in with your agent and mortgage broker regarding (a) whether you qualify for an FHA loan and (b) whether you’ll be able to find a property that works for you and for the FHA within the realm of what’s affordable for you.

It’s true – the conservative lending guidelines on FHA loans will limit how much you can spend, and require you to pay monthly private mortgage insurance (PMI), if you put less than 20% down. But PMI is tax deductible and eventually goes away. So what this really means is that you’ll more than likely end up with a mortgage payment that you can easily afford to pay for a long time to come. And it might be less house than you might be able to buy with a higher-down payment, less conservative loan, but less is more, people. Less is more (especially when it comes to mortgage payments!).

Also, while no-down-payment loans are almost extinct, there is a little tiny exception for borrowers employed in a certain set of professions: doctors, lawyers, dentists and C-suite executives of Fortune 500 companies are all potentially eligible for zero down professional loans offered by a couple of small, private banks. These loans do have the basic credit and income requirements, but they require ZERO down payment, because these professionals are perceived as posing a very low risk of foreclosure. In some cases, pros can qualify for up to $1 million with no down payment!

Save your dough in a high-interest online savings account. Regular bank savings accounts are paying right around .10% interest right now. Ally and SmartyPig are paying somewhere between 2 and 3 percent. Every little bit helps, right?

Sell your junk. eBay, anyone? Not only does selling the stuff you no longer need or use generate cash to put into the down payment kitty, it has the side effect of feeling almost like preparation for moving. Clear out your clutter, make room for your new life as a homeowner, and make a few bucks at the same time. That’s what I call a #WIN.

Get a side gig – Blogging, weekend table-waiting, baking, dog-walking – it’s not overkill to get a second job or start a small side business to power your help you either pay down your debt or save up for a

Borrow it from your city or state. The federal homebuyer tax credit is history, but many state and local governments still offer incentives for homebuyers in the form of down payment assistance programs. Most often, these are second mortgages with very low or no payments for 5, 10 or even 30 years (in Oakland, California, for example, the down payment loan doesn’t have to be repaid for 30 years or until you sell or move out). And many will help not just low-income buyers, but also those with moderate incomes, or anyone buying their first home!

Google and to see what your local government has on offer, and what it takes to qualify.

Borrow it from yourself! If you have a 401K or Roth IRA account and some years to go before retirement, you might be able to tap into it or even borrow against your own funds for your down payment. Currently, you can take up to $10,000 out of your Traditional IRA with no penalty to put toward the purchase of your first home, but you will be taxed. You can take as much as you want out of your Roth IRA contributions with no penalty or taxes, though, and as much as $10K from your earnings penalty-free for your down payment. The rules get a little tricky, here, so definitely check in with your tax and financial advisors.

And while you can’t similarly draw from your 401K, many retirement and pension plans will allow you to borrow the money against your funds, then repay it to yourself – at interest. Hmmmm, pay your lender back with interest, or pay interest to yourself – choose you! But first, get some advice from your CPA or financial planner.

Get the gift that keeps on giving. Cash gifts from relatives are seen by many lenders as a legitimate resource for down payment funds. There are guidelines, though - some lenders require that you put your own money on top of a small cash gift (less than 5% of the purchase price); but will let you use gift money exclusively if the gift is 20% of the home's price or more. Also, most lenders require a "gift letter" documenting that the giver is your relative and is not expecting you to pay the money back.

Check in with your mortgage broker for a briefing on gift-money guidelines.

If it seem like a "gift" is a hard thing to come up with - don't dismiss the concept too soon. I know more than a few now-homeowners who had no clue where their down payment money would come from until they were reminded about gift money as a strategy, then cashed in long-ignored offers of help from parents, aunts and uncles.

Psst - you should follow Trulia and Tara on Facebook, too!

Politics: Let's not let them eliminate the Mortgage Interest Deduction

http://www.reuters.com/article/idUSN2820160820100728

A couple hours ago Reuters reported that a panel appointed by President Obama recommended the end of tax breaks for things like Mortgage Interest Deduction. I don't know about your clients, but the this is one of the major reasons many of my clients want to own homes.

On one hand the government tries to spur home sales for a short period of time by offering the $8,000 tax credit - then they discuss finding ways to make homeownership less and less attractive. Not only is it irresponsible, it happened and was a huge failure in the 80s. Sure it would bring another windfall into the treasury - until people stopped buying houses.

I suggest calling your congressman and make sure they know the consequences to this action. I know I'm going to write mine:

John J. Duncan: http://duncan.house.gov/services/contact-information.shtml

Preparing for Disaster

For Your Clients: 4 Steps toward Preparing Your Home for a Disaster

By Stephanie Andre

RISMEDIA, July 22, 2010--It's hard to believe that it's already been five years since Hurricane Katrina devoured the Gulf Coast. While hurricanes are not preventable, there are steps you can take to protect yourself and your property should disaster strike.

Here are four important steps to consider, according to the Insurance Information Institute:

STEP #1: Review Your Insurance Coverage
Be sure you have the right kind and amount of insurance, enough to rebuild your home and replace your belongings.

STEP #2: Create a Home Inventory
An up-to-date home inventory will speed up the claims process by substantiating losses and may provide documentation for tax purposes. It can also help you determine how much insurance to purchase. Visit www.knowyourstuff.org to download software to help make this process easier.

STEP #3: Protect Your Property
Keeping wind and water out of your home is critical. Invest in storm-grade gutters and make sure that the best drainage away from your home is in place. Secure roof shingles and seal any openings, cracks and holes. Gable end walls and roof sheathing should be strongly attached and braced, and double doors should have heavy duty anchors at the top and bottom and a dead bolt at least 1” long.

STEP #4: Have an Evacuation Plan
Decide where you will go and how you will get there, and have more than one option. Keep a map, phone numbers and addresses handy. Think about what you’ll need to take with you — items like medicines, important documents, clothing and food — and have them ready to go.

Reductions!

I have made reductions at three of the homes I have listed!

4904 Bay Street is now available at $114,900, 2610 Belvedere is now available at $39,500 and 2621 Fairview is now reduced to $99,900. All three of these are priced below market rates. I encourage you to check them out at www.robsellsknoxville.com or give me a call at 8658-385-9070 to take a look.

Easter and the Early-Spring Buying Frenzy.

Spring and Easter time in Knoxville is great. The picture above is my niece Jaylen enjoying her first Easter as more than a "bundle-baby." Real estate in Knoxville is still going well. Lots of people are working to find their perfect starter home before the dreaded April 30th deadline for the first-time homebuyer's tax credit. I am interested in the next couple of months. I suspect they will still be good, but conventional wisdom says that the demand has artificially been pulled forward in time - another way that people who aren't ready to buy homes are getting themselves into trouble.

I am confident that the folks I'm helping to buy their first homes are buying conservatively and they will be able to recuperate their investments and possible make money when they are ready to sell their homes. I just hope that other Realtors are looking out for their buyers, rather than trying to pad their wallets a little more by talking their clients into the bigger, fancier home that will be a statistic rather than a long-term home.

Staging Secrets on HGTV.com

I was recently asked to give some tips on staging your home to sell for HGTV.com. My friend and former client Leslie Judson did a great job editing my tips for print and I really enjoyed working with her. A link to the article:

Staging Secrets: Top 10 Ways To Wow Potential Buyers At Every Showing

Learn from realtors how to prepare your home for resale. Start with these 10 simple and smart tips.

Some of the tips:

Staging sells houses. If you can't hire a stager, there are several ways you can stay ahead of the curve and catch potential buyers the moment they step in your house. Broker Rob Howard has learned the importance of preparing for showings, and here are his top 10 tips.

1. Nothing Personal But Remove the Photos:
People can be very photogenic, but many clients are distracted by portraits of the sellers, and miss out on key selling points of the home. As an amateur photographer, I love displaying my work, but if I'm selling my house, art will be displayed without people in it. No matter how nice the display, personal photos are just that: too personal.

2. Accentuate the Positive:
My clients usually know what they like best about their home. It's usually what they saw that made them want to buy, or it's something that they added to make the home particularly special. Whether it is a staircase, a great view from the kitchen sink, a pergola or a three-car garage, do something to make the buyers linger in that magic space.

3. Smells Like Home:
I've heard of many real estate agents bringing in a toaster oven to bake cookies or fresh bread. One colleague joked about keeping an Easy-Bake oven in the trunk of her car. I usually opt for a few plug-in air fresheners. I like using vanilla in the kitchen, fresh scents in the laundry, apple cinnamon in the living room and such. Specific aromas add a theme to the tour, even when it's not an open house.

4. Ditch the Kitsch and Hide Your Opinions:
My favorite example of unnecessary and unwelcome kitsch is the pink pig sitting on the fridge door asking if you're eating again. It oinks when your potential buyer opens the refrigerator. This and other comical quips are great fun when you're living in your home, not when you're trying to sell it. Especially avoid politically-charged material that expresses strong opinions. You don't want a potential buyer to dislike you for your beliefs, so remove all questionable material out of sight.

5. Clean Up Your Act:
If you are selling your house, cleaning is a no-brainer. And clutter is a killer. Get a head start on packing, and begin boxing up extras that are taking up space on your mantel, table surfaces, etc. Clutter makes a house look smaller, and if you have a small house, it makes it feel claustrophobic. Not advantageous to a quick or profitable sale.

(Five more tips at the website!)


Rob Howard is a real estate agent and broker in Knoxville, Tennessee and has been buying, selling and renting homes for more than 10 years. He advocates the well-executed open house: If it's well-priced and beautiful, it will sell itself! For more real estate tips, visit www.robsellsknoxville.com.

New listing: 1895 Victorian in Old North Knoxville $244,900

For more information check it out at www.robsellsknoxville.com

117 Lakeview St. - My own creation

After a few months of work on rehabbing a house that I've owned for several years. I'm ready to reveal it to the world and offer it up for bids. The past few 40+ degree days have really made finishing it up easier. I'm in a quandary - there are two "regular" bedrooms and an office/playroom/storage area that is separated from the other rooms. It could be called another bedroom, but the builders of the house made it long and skinny. I'm talking 8' wide and 17' long! I initially put two large storage units in the room to augment the cabinet space in the kitchen, but I'm going to probably remove one of them because they make the room seem even skinnier. Anyway, all this to say that I've put a lot of effort and have had a great time working with my dad on this project. We brought in the experts when needed, but for the most part did the work ourselves.

See the photos at: