Saturday, June 30, 2012

HOMEOWNER TIPS: Replacing a toilet fill valve

By Paul Bianchina
Inman News®

Do you have an older toilet that annoys you with the sound of water trickling after you flush, long after it should have shut off?
Have you tried adjusting and bending that big, frustrating, slimy rod and ball thingy and still can't get things right?
Then it's probably time for a new valve, and luckily this should prove to be one of the easier and less expensive projects on your to-do list.
Out with the old
Inside your toilet tank is a device called a ball cock. It's a vertical valve on the left side of the tank, and it passes through a hole in the bottom of the tank itself, where it attaches to the incoming water line. When the toilet is flushed, water in the tank is released into the bowl to flush away waste, and the ball cock valve opens, allowing water to enter and refill the tank. A small tube coming out of the side of the valve enters a vertical tube called an overflow pipe, which is attached to the bowl. That allows a certain amount of the incoming water from the ball cock to be diverted into the bowl as well.
Older toilets utilize a float ball attached to a long arm, which floats on the surface of the water in the tank. As the water level rises, so does the float, until it reaches a preset level and shuts off the incoming water. Those float arms are notoriously cranky to adjust, and the older style of ball cock valves can get gummed up with sediment and other gunk over the years, leading to noisy operation and, worse yet, water-wasting leakage into the bowl because the valve never truly shuts itself off.
The solution is to replace the old-style ball cock valve with a newer one, such as Fluidmaster's 400A Fill Valve. Fluidmaster has replaced the float ball and arm with a float cup that rides up and down on the valve itself, so it's a lot easier to adjust. It's also all plastic, so corrosion isn't a factor, and it tends to maintain itself in the position where you set it.
Replacement is very straightforward
I recently had to replace a couple of these at my own house. The box said it was a 15-minute operation. The first one took a bit longer than that, due to a leaky water line that wasn't the valve's fault, and I got the second one changed in less than 10 minutes, so the average was right on. I will say that their instructions are some of the best I've seen.
To begin, shut the water to the toilet, then flush it to get most of the water out of the tank. After that, it's bail-out time. Use a small can or whatever's handy to scoop out as much remaining water as possible, then sop up what's left with a sponge or a towel. It doesn't need to be bone dry.
Now, unscrew the water line where it attaches to the bottom of the old ball cock (below the tank, on the left side), then loosen the big nut that holds the old ball cock in place. Take care not to damage the porcelain tank – advice that holds true throughout this process. Remove the old ball cock and discard it.
There are some parts packed in the Fluidmaster kit that you need to separate from one another; the instructions clearly explain how. One of those parts is a rubber washer, which you need to place over the end of the new valve before placing the valve temporarily into the hole in the tank.
Now comes a simple adjustment. On the side of the valve is a mark labeled "C.L.," which stands for critical level. Basically, it's a guide to help you with where the water level needs to be so that the valve operates correctly. As the instructions explain, you're going to want the C.L. mark to be at least 1 inch above the top of the overflow pipe. To achieve that, simply wind the adjustable valve stem clockwise or counterclockwise into the valve body, then measure from the overflow pipe to the mark until you have the measurement you want (in the "tools needed" part of the instructions, they neglect to mention you should also have a ruler or a tape measure, but that's no big deal).
Once you have the dimensions correct, you can install the valve. Hold it in place so that the refill tube outlet is facing the overflow pipe and the float cup isn't contacting the side of the tank anywhere, then press down to seat the washer and secure the valve in place with the provided lock nut. You're instructed not to use tools on the lock nut, and that's good advice; hand pressure is enough to get a watertight seal against the washer, and anything more risks cracking the tank.
Now, reconnect your water line to the bottom of the new valve. The instructions clearly cover four different types of water lines. New washers are provided where needed.
Next, connect the new refill tube between the valve and the overflow pipe, using the angle adapter fitting and clip that's provided in the kit; you may need to trim the tube to the proper length so that it doesn't kink, which is easily done with a pair of scissors.
To clear the valve of any possible sediment, you need to remove the cap from the top of the valve and flush it out. This is done by simply rotating the cap 1/8 of a turn counterclockwise, and it will unsnap and pop right off. Place a can or other container over the top of the valve to contain the water, then slowly turn the water valve back on. Water will shoot out of the top of the valve, clearing out any sediment. Repeat this a couple of times, then leave the water valve off.
Replace the cap on the valve by pressing down and turning 1/8 turn clockwise until it snaps back in place, then turn the water valve back on. The tank will now fill with water. Watch the level of the water in the tank. Your toilet should have a mark inside the tank indicating the ideal water level. If it doesn't, you'll want to shoot for a level that's about 1/2 inch to 1 inch below the top of the overflow pipe. If the water level is too high or too low, simply turn the adjustment rod on the side of the valve to raise or lower the float cup, which will change the water level; you may need to flush the toilet a couple of times to finalize the adjustments.
Fluidmaster valves and other replacement toilet parts can be found at home centers, hardware stores and a variety of other retailers, as well as online through retailers such as Amazon.com.

Thursday, June 28, 2012

Mortgage rates head deeper into record territory

By Inman News
Inman News®

Mortgage rates headed deeper into record territory this week as rumblings from Europe continue to make the guaranteed bonds that fund most mortgage loans look like a safe bet to investors.
Fears that the European debt crisis will derail the global economic recovery may also be weighing on would-be homebuyers, as demand for purchase loans slipped last week, with applications back down to levels seen a year ago.

Economists at Fannie Mae said in a monthly outlook report released today that they continue to see "a number of threats that could dampen growth" this year, including "substantial risk that investors will lose confidence in the ability of Europe to solve its problems over the intermediate term."

Recent elections in Greece and France indicated "waning public support for austerity, igniting fears that the sovereign debt crisis could develop into a more significant credit crisis that could spill over to countries around the globe," Fannie Mae economists Doug Duncan and Orawin T. Velz said.

With the U.S. again approaching its debt ceiling, there's also uncertainty over whether the lawmakers here will reach a long-term budget agreement and forestall more than $1 trillion in automatic spending cuts set to begin taking effect at the end of this year.

With Republicans demanding spending cuts and Democrats angling for tax increases, the debate over raising the debt ceiling is "likely to weigh heavily on financial markets and consumer confidence, potentially dampening growth late in the year," Duncan and Velz said.

Several members of the Federal Reserve committee that determines the central bank's monetary policy are worried that uncertainty over the budget could lead businesses to defer hiring and investment, according tominutes of the committee's last meeting in April.

Although housing sales appeared to be losing steam at the end of the first quarter, Fannie Mae economists are sticking to their projections that total home sales will increase by a little more than 7 percent this year, and that housing starts will jump nearly 20 percent.

Modest economic growth, and uncertainty about the European debt crisis and the U.S. budget talks, should at least serve to keep interest rates low, Fannie Mae economists said. They expect rates on 30-year fixed-rate mortgages to rise slowly back toward 4 percent by the end of the year.

Freddie Mac's weekly Primary Mortgage Market Survey showed rates on 30-year fixed-rate mortgages averaged 3.79 percent with an average 0.7 point for the week ending May 17, down from 3.83 percent last week and 4.61 percent a year ago. That's a new low in Freddie Mac records dating to 1971.

For 15-year fixed-rate loans, rates averaged 3.04 percent with an average 0.7 point, down from 3.05 percent last week and 3.8 percent a year ago. That's a new low in records dating to 1991.

Rates on five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) loans averaged 2.83 percent with an average 0.6 point, up from 2.81 percent last week but down from 3.48 percent a year ago. Rates on five-year ARMs hit an all-time low in records dating to 2005 of 2.78 percent during the week ending April 19.

For one-year Treasury-indexed ARM loans, rates averaged 2.78 percent with an average 0.5 point, up from 2.73 percent last week but down from 3.15 percent a year ago. Rates on one-year ARMs hit an all-time low in records dating to 1984 of 2.72 percent during the week ending March 1.

Looking back a week, a separate survey by the Mortgage Bankers Association showed demand for purchase mortgages fell a seasonally adjusted 2.4 percent during the week ending May 11 compared to the week before.

Demand for purchase mortgages was down 1 percent from a year ago.

There was a 13 percent increase in applications to refinance from the week before, with 28 percent of applicants seeking loans through the Home Affordable Refinancing Program (HARP), which is targeted at underwater borrowers.

In their monthly economic outlook, Fannie Mae economists said the latest numbers show "some loss of momentum" in housing activity late in the first quarter.

After a "robust gain" in January, existing-home sales fell in March for the second consecutive month. Although first-quarter existing-home sales were much stronger than a year ago, they remained below the pace seen during the first three months of 2010, when federal homebuyer tax credits were still in place.

"Housing will continue to face many challenges," Duncan and Velz said. While the Census Bureau's latest housing vacancy survey suggests that the inventory of homes available for sale or rent is shrinking, it also shows a continued rise in the number of vacant homes held off the market.

"Combined with the still elevated number of seriously delinquent loans, the current environment indicates that the shadow inventory will remain an issue for the housing recovery in coming years," Fannie Mae economists said.
"The overhang of the shadow inventory will continue to weigh on home prices."
Although low mortgage rates are "one positive for the housing market," lending standards for mortgages remain tight, they noted.

Fannie Mae's latest survey of consumer's views of housing market conditions, conducted in April, showed some improvement in sentiment among buyers and sellers.

The survey found that on average, Americans expected home prices to increase by 1.3 percent over the next year, up 0.4 percentage points from March and the highest value recorded in the survey's two-year history.

Although 71 percent of those surveyed said it's a good time to buy, only 15 percent thought it was a good time to sell. And 32 percent of those surveyed said they would rent if they were going to move, up 2 percent from March and the highest level since November 2011.

Tuesday, June 26, 2012

Appraisals are lagging behind the market

I agree with all that is being said regarding the changing markets -- lower inventories, closer-to-list-price negotiations, and the potential for rising prices. But the issue I now encounter is the appraisals are lagging behind the market; therefore, they do not match the current market values or the sold price. 

Challenges of the appraisals are met with disdain and then disapproval. Outcome: The buyer does not get the home they want at the price they are willing to pay, and the seller can't sell their home at the current, rising market value. This perpetuates the slow recovery.

Sunday, June 24, 2012

Bank of America offers relo assistance to short-sellers

By Inman News
Inman News®
Bank of America says it will provide up to $30,000 in relocation assistance to delinquent borrowers who work with the bank to obtain a preapproved short-sale price before submitting purchase offers.

Short sales must be initiated by the end of this year and close by Sept. 26, 2013, to be eligible for the payments, which will range from $2,500 to $30,000 at the completion of a qualifying short sale. Payments will be determined on a case-by-case basis using a calculation that includes the value of the home, amount owed and other considerations, Bank of America said in announcing the program.

The program -- based on a similar incentive offer Bank of America tested last year in Florida -- will be available nationally. But Bank of America anticipates the greatest response will come from borrowers in California, Nevada, Arizona, Florida, and other states hit hardest by the economic downturn and falling property values.

Customers who believe they may be eligible for Bank of America's short-sale relocation assistance program may contact program specialists at (877) 459-2852. Qualifying short sales that have already started but have not closed may be eligible for the program.

Bank of America says its short-sale initiatives have generated 200,000 short sales in the last two years and another 30,000 in the first three months of this year.

Last month, Bank of America announced it was shortening decision times on short-sale offers to 20 days, down from 45 days or longer.

Friday, June 22, 2012

New Freddie Mac CEO takes pay cut

Freddie Mac's new chief executive officer, former JPMorgan Chase & Co. executive Donald H. Layton, will make just a fraction of what his predecessor did.
Layton -- who retired from JPMorgan Chase in 2004 as head of the company's financial services unit, which included the fourth-largest mortgage firm in the U.S. -- has resigned his position on the board of American International Group (AIG) to take over at Freddie Mac, where he will earn a base salary of $600,000 a year, the mortgage giant said in a regulatory filing.
According to the Washington Post, Layton's predecessor, Charles E. "Ed" Haldeman Jr., earned $3.8 million in compensation in 2011. Freddie Mac's CEO when the company was placed under conservatorship, Richard F. Syron, was slated to earn $18.3 million in compensation in 2007, the Post reported.
Karen Shaw Petrou, managing partner of Federal Financial Analytics, told the Post that pay limits imposed by lawmakers make it difficult to find executives to head up Freddie Mac and its sister company, Fannie Mae.
"You have to be really public-spirited to do it," Petrou told the Post.
Layton continues to receive deferred compensation from JPMorgan Chase, which services more than 1 million mortgages for Freddie Mac and has underwritten billions in company debt.
In order to avoid potential conflicts of interest, Layton "has agreed to recuse himself in specified circumstances from acting upon matters directly relating to JPMorgan Chase that may be considered by Freddie Mac's board of directors or presented to him in his capacity as Freddie Mac's chief executive officer," Freddie Mac said.
JPMorgan Chase is the second-largest servicer of Freddie Mac loans, collecting payments or otherwise administering 1.28 million mortgages with an aggregate unpaid principal balance of more than $203 billion.
In addition, JPMorgan Chase sold approximately $40.2 billion in single-family loans to Freddie Mac in 2011 and $7.92 billion in single-family loans to Freddie Mac in the first quarter of 2012.
JPMorgan Chase also has $1.5 billion of interest rate swaps with Freddie Mac, and since January 2011 has served as the underwriter for $11.6 billion of Freddie Mac's debt securities and $35.3 billion of Freddie Mac's mortgage-related securities.
NRT taps Gorman to head strategic operations
NRT LLC, the nation's largest real estate brokerage company, has created a new position -- senior vice president of strategic operations -- and named an executive who oversaw merger and acquisition activities for parent company Realogy Corp. to fill it.
M. Ryan Gorman "was the driving force" behind Realogy's Title Resource Group's acquisition of Texas American Title Company, Cartus' acquisition of Primacy Relocation, and NRT's acquisition of Coldwell Banker Preferred in Philadelphia, the company said in announcing his new role. Gorman also contributed "significant strategy" work for Realogy brands and franchisees.
 
M. Ryan Gorman
Gorman "has repeatedly shown exemplary business acumen and strategic vision both in his efforts to grow Realogy's business and in the numerous successful mergers and acquisitions he has executed over the past few years," said Realogy Corp. CEO Richard A. Smith in a statement.
In his new role, Gorman will lead NRT's overall strategic growth and competitive analysis functions, to ensure the brokerage "is positioned to take full advantage of the recovering housing market," NRT said.
Gorman will also have operational responsibility for growing NRT's commercial, insurance, real estate owned (REO), property management and rental businesses, as well as overseeing its mortgage, title and home warranty services partnerships.
Before joining Realogy in 2004, Gorman held advisory and principal investment roles with PricewaterhouseCoopers, Credit Suisse and The Blackstone Group. He graduated with honors from the Wharton School of the University of Pennsylvania.

Wednesday, June 20, 2012

8 things to know about buying a home today

By Dian Hymer
Inman News®

The home-sale market is showing signs of life. More buyers are confident now than they were a year ago that now might be a good time to buy. Interest rates are near all-time lows and home prices in some areas are back to 2002-2003 levels.
Some analysts are finally suggesting that we may be headed for recovery. If you have a secure job, plan to stay put and feel this is the right time for you to buy a home, consider the following.
In most places in the country, home prices are still declining. It has only been recently that the market picked up and it's too soon to know if this will result in a sustainable increase in prices.
The recent home sales in areas around California's Silicon Valley defy the norm. Significant job growth in the area combined with a low inventory of good homes for sale has resulted in multiple offers with buyers bidding the price up sometimes hundreds of thousands of dollars over the asking price.
In other high-demand, low-inventory areas, you may find yourself bidding against other buyers, perhaps even more than once. This doesn't necessarily mean that the price will be bid up significantly over the asking price. This will vary from one listing to the next depending on property location, condition and price.
It's important to research the local community where you want to buy. Find out what homes are selling for, if multiple offers are common and if listings are selling for more than the asking price. This will help you make a realistic offer that might be accepted when you find a home you'd really like to buy. It helps to work with an experienced local real estate agent.
Some sellers in high-demand niche markets intentionally list their home at a low price hoping to stimulate multiple offers. If you see such a listing and there are a lot of buyers wanting to make offers, you will be better able to know how high your offer would need to be to win the contest if you have done your due diligence.
HOUSE HUNTING TIP: Whether you're anticipating competition or not, you should be preapproved for the mortgage you'll need to complete the purchase before you write an offer. In competition, this will make a big difference, particularly if everyone else who is offering is preapproved. It also lets you know what you can afford. And, it puts you in a good bargaining position with the seller.
Buyers aren't the only participants in the housing market that have heard the news that the market has improved. Some sellers are putting their homes on the market because they've been waiting for a better time to sell. This is good news for buyers looking in low-inventory markets.
You should expect that you will have to negotiate. Many of today's sellers are selling for less than they paid. Even though the market has improved a bit, sellers may be disappointed with the current market value of their home. Be prepared to negotiate, not just the initial price, but after inspections are completed if items come up that you hadn't anticipated.
Include realistic contingency time frames in your purchase contract for loan and appraisal approval if you're applying for a mortgage. The recent uptick in the market means that lenders are suddenly overwhelmed.
In mid-March, buyers in Oakland, Calif., who were seeking approval for a jumbo loan were told they could close a transaction in 21 days. Not only could they not close in 21 days, it took more than 21 days for loan approval due to lender backlog.
THE CLOSING: Underwriters could require that additional conditions be met before you can be approved. Act quickly to avoid further delay.

Monday, June 18, 2012

Building a pondless water feature

By Paul Bianchina
Inman News®

There's nothing quite like the sound of water bubbling in your backyard. A water feature can become an eye-catching landscaping feature, or a cool and tranquil backdrop that also helps block unwanted traffic or neighborhood noise.
A water feature can also be a great do-it-yourself project that just about anyone can tackle.
The term "water feature" can mean different things to different people. But if you want a stunning, low-maintenance option that's customized to your yard and your style, consider going "pondless."
Also known as a "disappearing pond," pondless water features eliminate the open pond that requires periodic maintenance to prevent algae and other problems, along with potential safety issues for small children. Instead, they use a water reservoir, a recirculating pump, and some type of rock or other feature that the water flows out of. The water filters down through a rock base over the reservoir and disappears, to be recycled endlessly.
The basic components
Pondless water features can be large or small, simple or elaborate. Their design is pretty much limited only by your imagination, ambition and budget. But they all share the same four basic design elements:
1. The reservoir: This is simply a big, relatively shallow round or square box made of a tough, high-impact resin. The box is solid on the bottom and sides to retain the water, and is perforated or slotted on the top to hold the rock while allowing the water to drain through. The top also has a removable plate to access the pump. Reservoirs come in a few different sizes, depending on how much water you want the system to process.
2. The pump: This is a submersible, 110-volt electric pump specifically designed for these applications. It sits inside the reservoir, with a filter on the inlet side to filter out impurities, and a hose on the outlet side that's routed to wherever you want the water to come out. There are several different sizes available, depending on the amount of flow desired.
3. The water outlet: The water coming from the pump exits through some type of visible outlet, and this is where your creativity can have free reign. Many water features utilize a natural piece of basalt as the center piece of the design, which is drilled to receive the hose coming from the pump. You can find basalt in many sizes and shapes, and you can use one piece alone or a grouping of several pieces with the water tumbling over all of them. Other options include decorative jugs, vases of any size or shape, actual water fountains, cherubs and other garden statues, pieces of discarded masonry, and many other objects.
4. Base rock: Finally, you'll want to cover the reservoir with a layer of rock that the water flows over and disappears into. There are many different types, sizes and colors of rock to choose from, depending on your personal preferences. You can mix and match sizes and colors, as well as incorporating pieces of natural wood, metal sculptures and other objects you might like.
Putting it all together
Select an area for the water feature, and lay out the general size and shape you want. Remember that the overall size of the rock base can be the same size as the reservoir, or it can be substantially larger.
Next, you'll need to excavate a hole for the reservoir itself. The hole should be a little wider and a littler deeper than the reservoir, to allow for leveling and backfilling. Place a layer of sand in the bottom of the hole, which will make it easier to level the unit, and also protects it from rocks. Check the level in all directions; pack some additional sand into the hole around the base to stabilize it; and then backfill up to the level of the top lip.
If you're installing a heavy water feature such as a piece of basalt, it's typically installed next, directly on top of the reservoir for stability. Be sure you have adequate help for lifting this into place; some larger pieces will even require a forklift or other machinery. Route the hose through the hole in the rock, and seal it with an approved sealant.
Install the pump in the reservoir and connect the hose. Route the wire from the pump to an exterior-approved, GFCI-protected electrical outlet, but don't plug the pump yet. Make sure the inside of the reservoir is clean, then fill it with clean water. Activate the pump and test all the connections and the flow rate. If everything looks good, install the access door on the top of the reservoir, then cover the top of the reservoir with the base rock.
Shopping
You can sometimes find small water feature kits, with a reservoir, pump and all the other components, at home centers, warehouse stores and other retailers. For larger pump and reservoir equipment, check with any local retailer that handles landscaping supplies, including nurseries or sprinkler dealers. They'll either have the materials you need in stock or they can easily order them for you. They can also work with you on the proper sizing of the pump. You can also find what you need online; start with a search for "disappearing water features," and go from there.
For basalt and other rock, check with any local retailer of rock supplies. They can also drill rock for you if you find a specific piece that you like, and can assist you with delivery and placement. As far as the electrical wiring's concerned, consult with a licensed electrician to have the proper GFCI outlet installed near the water feature's location.

Saturday, June 16, 2012

Foreclosure Activity Declines Hurting Investors

Top Story
April 2012 Foreclosure Starts declined across our coverage area wiping out the small gains in new foreclosure filings last month. In California, Notice of Default filings are down 69.8 percent from the peak in March 2009, and 15.8 percent from April 2011. Notice of Trustee Sale Filings, the start of Arizona's foreclosure process, are down 59.4 percent from the peak in March 2009, and down 8.0 percent year-over-year.

Foreclosure Sales also declined, however, foreclosure investors purchased a record percentage of the limited inventory that was actually sold. Nevada investors purchased more than 50 percent of foreclosure sales for the first time at 50.7 percent. Arizona followed with 44.6 percent and California at 41.3 percent. The low number of sales, combined with record percent purchased on the courthouse steps left very little to become Bank Owned (REO). This further depletes the inventory of Bank Owned homes as REO sales continue to outpace the addition of new inventory.

Despite investors purchasing a higher percentage of foreclosure sales, margins have rapidly declined in recent months. In both Arizona and Nevada winning bids on the courthouse steps on average equal the current estimated value of those properties. In California the discount between market value and winning bid have on average declined to 12.3 percent. This leaves investors who intend to resell their purchases with record low profits after eviction, repairs, and closing costs.

Thursday, June 14, 2012

The Problems of "Flips"..and Why they Don't Often Close!!!!!

Less than
30 Days since Seller Acquisition

· Not allowed unless seller meets one of the following exemption criteria:

· State and Federally chartered financial institutions and government sponsored enterprises (Fannie and Freddie).

· Local and State government agencies.

· Non-profits approved to purchase HUD REO properties.

· Both lenders and property disposition firms they hire or with whom they are affiliated are temporarily exempt from the 30-day
lock out period.

· Profit and non-profit entities that purchase abandoned or foreclosed properties using “Neighborhood Community Stabilization Program” funds are exempt from the 30-day lock-out period.

Problems:

(Since the typical buyer is locked out for the first 30 days…many of the best properties have already been snapped up).

1 to 90 Days since Seller Acquisition

If the property is being sold within one and 90 days of the seller’s acquisition date and the new sales price is 20% or more than
the seller’s purchase price, all of the following are required.

(Professional “flippers” rarely flip a property that can’t be marked up AT LEAST 20(+)%).

A second appraisal is required. Both appraisals must support the sales price and provide evidence that repairs and/or renovations were completed in a professional manner.

(Appraisal problems in our industry are well known and are is just one person’s opinion…now we have to have TWO possible potential problems).

(Another issue…the second appraisal CAN NOT be paid for by the buyer…which means the sellers have to come out of pocket ... Approx. $500 IN ADVANCE OF CLOSING).

(If the second appraisal comes in below the sales price, the LOWER of the two values will be used, leading to you having to renegotiate sales price).
(In other words your deal is probably dead and someone is out $500).

“It gets better….keep reading”.

A property inspection (cost $300) completed by an inspector who has “no interest in the property”.

The inspector must be paid by the LOAN OFFICER/BROKER.

The borrower MAY reimburse the lender at loan closing.

Then seller has to provide evidence verifying sufficient legitimate renovation, repair, and rehabilitation work on the subject property.


Herein lies several more problems:

1) Often repairs and renovations are shoddy and completed hurriedly.

2) There’s a lack of disclosure of those hidden defects.

3) Sellers don’t want to fix anything in a standard transaction, so this issue is PARTICULARY “acute” with flippers.

4) Most flippers are borrowing short term money (i.e. “hard $$$”) so they want the shortest escrow possible. Given that we need 2 appraisals AND an a “in house “ lender inspection YOU’RE LOOKING AT 45 -60 DAYS TO COE.

5) Even though these delays are not anyone fault…all of which will aggravate the borrowers and may lead them to find another property with OR without YOU AND/OR I.

91 to 180 Days since Seller Acquisition

If property is being sold between 91 and 180 days of the seller’s acquisition and the sales price increases by more than 20%...only 1 appraisal and 1 property inspection is required.

The buyer cannot pay for this inspection either.

In Closing

At this point you are probably wondering why all the additional hoops.

Simply stated: Buyers who purchase substandard properties are more likely to walk away!

Lenders and PMI companies (and the government agencies who guarantee the loan.) don’t want need any more foreclosures on their hands crashing local values.

So they put everyone thru more hoops than a Barnum and Bailey circus to insure the value/workmanship of the property.

Professional flippers provide a real service to the community by rehabbing dilapidated properties and maintaining the values of neighborhood.

Our job as real estate professionals are protecting our clients. And all these rules are not supporting us in doing that.

Tuesday, June 12, 2012

The Functions of Escrow

Buying or selling a home (or other piece of real property) usually involves the transfer of large sums of money. It is imperative that the transfer of these funds and related documents from one party to another be handled in a neutral, secure and knowledgeable manner. For the protection of buyer, seller and lender, the escrow process was developed.

As a buyer or seller, you want to be certain all conditions of sale have been met before property and money change hands. The technical definition of an escrow is a transaction where one party engaged in the sale, transfer or lease of real or personal property with another person delivers a written instrument, money or other items of value to a neutral third person, called an escrow.

Sunday, June 10, 2012

Q & A: Solution for a sinking slab

Q: In an earlier column you offered some solutions for sloping floors on an old home with a foundation, but we are unsure what to do with the sloping floors in our home.

This subdivision was built in 1955 on former orchards, and the houses all sit on poured concrete slabs with no crawl space. Our house looks like a house that a kindergartener draws, with a peak in the middle and a main beam.

Between the orchard lands settling and the occasional earthquake, the slab has started to sink on both sides, so a marble placed in the middle right under the main beam will roll easily in either direction.

We do not want to try to raise the slab, but what about leveling the floor as it is now?

Can we just pour self-leveling concrete and lose the inch or two at one end of the slope and then place a new plywood subfloor on top of that? I would love to be able to have a level dining room table.

A: We wouldn't rule out the possibility of raising the slab. In fact, it might be the best solution, and when all is said and done, it also might be the cheapest. Our first step would be to hire a structural engineer to take a hard look at the situation and suggest a possible solution.

We see nothing but trouble with your proposed solution. Raising the floor with self-leveling concrete, which is really just a soupy slurry of high-strength cement, requires removal of all the flooring, baseboards, doors, doorjambs and trim. Then they need to be replaced.

Worse, you aren't solving the underlying problem. Without dealing with the foundation problem, the house will continue to settle, and sooner or later you'll be back in the same boat.

Your diagnosis of the cause of the sinking slab is probably right. The old orchard land is laden with decomposing roots, causing the soil to compress as the wood turns to dust. Couple that with the quakes and natural wet-and-dry cycles of the seasons and the soil is going to expand and contract. That would be OK if the slab continues to sink at the same rate.

But it doesn't, and for good reason. The weight of the roof is borne on the outside walls. The dead load of the structure is transferred from the peak, down the rafters, then down the walls to the outside edges of the slab.

The front and rear walls bear comparatively little weight. The extra weight from the roof structure results in soil under the slab compressing more than the soil at the front and rear of your "kindergartener's" house.

Generally, a single-story home built in an area where the ground doesn't freeze requires a concrete footing 12 inches below grade. That's presuming the soil is compacted and stable.

A foundation footing looks like an inverted "T" measuring 12 inches on the bottom, 6 inches on each side and 6 inches on the top. The leg of the "T" is long enough to get the top 6 inches above the finished grade, usually about 18 inches.

The perimeter of a slab foundation should also extend a minimum of 12 inches below grade with the top of the slab being 6 inches above the finished grade. Both types of foundations should contain steel reinforcing bar (rebar) to militate against cracking.

Fixing your foundation might be as simple as jacking up the low points and installing a beefier perimeter foundation or concrete piers that rest on solid soil. That's where the structural engineer comes in. He or she should be able to tell you if the foundation is deep enough, how deep it should be and exactly what type of remedial measures are required.

Finally, the engineer should be able to provide some names of licensed, bonded and reputable contractors capable of doing the repair.

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