Part 1: Everything You Always Wanted to Know about HUD homes.

The above was a HUD home.  What does that mean?  Hud homes are homes lenders foreclosed on and HUD purchased them at a discounted rate and will put them on the market for homeowners.  There are several steps in this process.  But first know to find the homes on the market go to hudhomestore.com.  When you get there, click on the map for the state you are interested in.  A box will pop up and you can type in the county you are interested in and all the houses that are for sale through Hud will pop up.  If you click on a certain property, a page will come up with its picture and a bunch of choices and information about the property.  One choice that is important is the Addendums as that page as the property inspection report and tells you what they KNOW is wrong with the property.  They will give an estimate of the price to fix the problems they know about.  That doesn't mean there is nothing else wrong with the property, just what they found with their inspections.  But you are buying the property "as is".  HUD makes NO repairs. 

There are three types of listings:  lottery, exclusive, and extended.  What does that mean?  Lottery are Good Neighbor Homes.  If you are a nurse, a policeman, a fireman, an EMT, or a teacher, you can by that property for HALF the listed price.  Not a bad deal!!  But you must live in the home for a certain amount of time, or owe the other half of the listed price.  These listings last a certain amount of time, and if no offer is accepted, they change to Exclusive listings.

Exclusive listings are for home owners.  You must live in the house, it can't be an investment property for you.  If they find you never lived in the home but used it as an investment, they can actually charge you with fraud, and if your realtor knew you were going to use it as an investment instead of a home, they too can be charged and lose their license.  Don't try and fool HUD!!
They have a set date for bids to be opened, and if they open these bids and there are no acceptable ones, they they'll stay day to day for a certain number of days and they'll open the bids daily.  After that time period, the listing becomes Extended.

An Extended listing is now open to everyone, even investors.  Knowing that 25% of the homes sold in August were short sales and REOs (repos) you know that there are plenty of investors out there waiting for these Extended listings.  These homes usually need a lot of repairs, but at the price you can get them, usually an investor can make the repairs, fix the home up to look nice, and then resell and make a profit, or turn it into a rental. 

Two of my children have bought HUD homes in the Exclusive listing time period and gotten great homes for bargains.  One home is now appraised at $155,000 and he paid $100,000, and did less than $3,000 repairs to it.  The other got a 2300, 4 bedroom, 3 bath, two story valued at least at $125,000 and possibly more as it is in an HOA housing addition with its own elementary school for just $88,000.  This home was less than 10 years old!! 

People think of Hud homes as wrecks and in blighted communities, but the recession left millions of homes out there who were lost to foreclosure through job loss, not through deadbeat abandonment.  Oh, I've seen some that the owners tore up before moving because they were angry.  One had kicked in a wall in every single room, poured black oil down the stairs, and removed all the closet doors and the electrical box.  But this is not the norm.  Most are dirty, possibly filled with junk they left behind as they hurridly left before being locked out, but some are very nice, clean and livable, as both of my children's homes were. 

What type of repairs might be made.  Speaking of my kids, one had to put in new light fixtures, a dishwasher, a vanity, sink and 3 mirrors and faucets, and a disposal.  That was it!!  The other had to have the air conditioner worked on, a piece of siding changed out, and something in the bathroom, a faucet I believe, fixed, and two places in the kitchen the drywall had to be repaired.  That was all.  Neither had structural problems or major plumbing issues.  Both did have to replace air conditioner motors within the first year, but if they had listened to mama and gotten the home warranty when they purchased the house, then that would have been a $60 repair.  But home warranties are another issue and we can cover them another day.

In the end, HUD homes are a way of getting a deal on a house, but be prepared to lose a few.  Meaning the good ones get lots of bids.  You need to be prepared to bid at least the asking price, cash is better than a loan if possible, as HUD doesn't have to wait 30 days to close then, and be prepared the have your loan prequalified before making a bid.  Don't be too disappointed if on the day of the opening of the bid you didn't get it.  Both of my children did NOT get theirs upon opening.  My son was sent a message he did not get it but did he want to be in back-up position.  I, as his realtor, responded yes.  5 days later, on Friday we got an email that he was now in first place.  Obviously the winner had either decided not to buy, found something else, or didn't meet the 48 hour contract deadline.  When you are the lucky accepted bidder, you have 48 hours (2 business days) to get your contract paperwork all in.  You have to fedex it for overnight delivery.  If they do not get it in time, they are heartless and go to the back-up offer. 

My daughter bid time and time again and kept being over bid.  On the house she finally got, she was not the lucky winner, but took the back-up position and in a few days was notified she was the winner.  So remember to be patient.  Even if you don't win on the opening, take that back-up position and you may still end up with the house in a few days.

There are many other things to discuss about the HUD procedure, but you can find answers to the most asked questions at Hudhomestore.com.  One thing I DO like as a realtor, a realtor must represent you and put your bid in.  You pay their commission, not hud, but it can be within your loan.  You may not like this, but it will be a lot easier for you having someone do all the paperwork who is experienced at it, keeping up with all the deadlines, and protecting your interests.  And for me, the realtor, it might just keep me in business for another year or so.

Frank Dodd Act Could Affect Housing Market

We had a program recently on the Frank Dodd Act and how it will affect the housing market.

On January 10, 2014, the provisions kick in where borrowers can sue lenders when they start to foreclose for not doing due diligence by giving them a loan when they couldn't repay it.  Now who in their right mind thinks investors are going to give people loans if they can sue them when they don't pay them back.  I'm sure due diligence is done when a loan is made, that's what underwriting and loan approval and qualification is all about, but if a person is a deadbeat or a person runs into bad times like health problems or job losses, a lender has no way to prevent that.

It is  believed this will make getting a loan VERY VERY hard, and we may see a slow down in loans.  We may see realtors changing jobs.  We may see few people being able to buy a house.

Should the FHA loan go away, we could see conventional loans requiring 20% down for a loan, and the end of 30 year loans. 

So in summary, if you want to buy a home, do it before January 10, 2014.

Veterans You Need to Buy a Home with Your Benefits!!

I just saw an amazing question/answer program with the head of the VA loan program, called a Hangout.  I am an experienced realtor and have done quite a few Veteran home loans, but even I learned some things watching this, and I want to share some of the information.

They gave their 20 millionth loan recently, in 60 years (started in 1944) of helping veterans buy homes.  Last year was their 2nd biggest year of giving loans and they are on track this year to beat the best year.  Why is this so popular?

1.  There are 25 million veterans and yet only 1.8 million have a  loan.
2.  There is NO down payment with a VA loan and the closing costs can be rolled into the loan, or
      you can ask the seller to pay them and up to 4% of the prepaids. 
3.  Veterans walk away from the closing table with $$$$ in hand; which can be used to fix broken
      heaters later on or do rehabs right now.
4.  It's not your Father's or Grandfather's VA program.  It's updated, computer friendly, no paper,
     Instant approval on your military qualification.
5.  These loans have the fewest defaults for the past 5 years than any other kind of home loan.
6.  You can refinance them with no appraisal fees under their Streamline program.
7.  If you have another type of loan, you can still refinance into a VA.
8.  If you are disabled, you can get rid of property taxes.
9.  If you live in Texas, use this and the Texas land Board and get a lower interest rate.
10. The pest inspection makes sure you get a good home that termites have not eaten away.
11. The inspectors have lightened up and they only report dangerous situations, like live   
      electrical wires.
12.  They have added 1,200 new appraisers, so their appraisal times have speeded up to 10 days
       rather than 30, so the time to close is shorter.
13.  You earned this benefit - USE it.  If you have an inexperienced realtor or one who is
      judging things based on long ago experience, find a realtor who knows today's VA program
     and save your CASH for other things. 
14.  There is NO mortgage insurance.  With an FHA loan the mortgage insurance can cost you up
      to $50,000 more over the life of the loan.  Don't let any realtor tell you its cheaper to use FHA.

OK, I'm a proponent of VA loan.  I'm dealing with a house sale today using VA and TLB.  I've helped several veterans save interest, which means lower house payments.  A FHA loan can have $140 in mortgage insurance per month, why pay that if you qualify for a VA loan.  Isn't it worth waiting 15 extra days to close to save $50,000 in mortgage insurance AND have NO out of pocket costs and walk away from the closing table with $$$. 

If you are a veteran, and you are going to buy a home, be sure and use VA for your mortgage.

How to make your concrete look like tile.

I am listing a house that is fantastic, and the owner is an artist.  In her painting room, she has a floor that appears to be tile, but it is not; its concrete.  She laid out electrical tape in the shape of tile.  This kept the lines rough and one color and then she chose two colors to sprinkle in the squares and swirled them around.  No two tile is identical but by using the same two colors (she used white and a lighter gray than concrete) it appears they are tiles with small design differences. 

She said now when she makes a mess painting, its easy clean up.  I think this is awesome and would like to try it even maybe outside on a porch or patio. 

That brings me to another idea, what if you used stain instead, a richer look maybe?  Hmm

My Redecorated Listing in Amarillo!

Here is a picture of a kitchen I just remodeled for a new listing.  I've worked on the house for three weeks now.  This kitchen features a Bermuda Bronze tin backsplash - that's where all the shine comes from - a new vent hood over the gas range, and dark brown tile was replaced with this light colored tile featuring a green diamond inset.  I put a new coat of stain/varnish on the 1965 cabinets which also added some shine.  By using a light tile with a linear pattern, we not only brightened the space but made it appear bigger.  The one thing I was not able to get done due to the budget, was add new lights.  I was able to add 4 new canned lights in the living room through!!

Here is the dining area of the house.  This use to have a brown fiberboard wall that was dark and depressing and dark brown wood tone flooring.  By painting the fiberboard a cappuccino white with marshmallow white trim, we brightened the room; and added the same tile as in kitchen making it appear wider..  We used the mirror from Garden Ridge with tin accents to cover a phone jack that was on the wall and balanced that with an original piece of art I made using the splash from the kitchen to form a diamond on a green canvas, thus we have a green diamond surrounded by the splash, tying the art work to the kitchen splash and the combo room's flooring.  We put back the yellow café curtains that had been in the room before, but now they appear light and free, not sad and depressed.

The most changed room is the living room above.  This room was a dark-panalled brown room, with NO lighting, just a fan, dark trim and dark brown dated carpeting.  We put three to 4 coats of cappuccino white Glidden paint on the paneling, painted all trim and ceiling with marshmallow white Glidden paint, and added a new beige carpeting.  This room is now bright and light.  We also added 4 canned lights.  Remember it had NO lights, now it has 4.  This transformation has forced the words of "this doesn't look like the same house" from the owners and neighbors.  This is a 18 x 14 room, which is rather large for a 1,000 sq ft 1965 home, and now you can actually see the space.  Before when you walked in you felt like you were in a dungeon.  I can see in my minds-eye a entertainment center next to that closet, featuring a big flat screen t.v. and a nice sectional in front of the three windows on the west front of the house creating a wonderful family living space. 

We painted all ceilings marshmallow white which brightened the whole house, even the two dark paneled bedrooms and added wall to wall carpeting in the three bedrooms and hallway, which also got painted cappuccino white.  What an amazing transformation that made to the hallway, just opened it up. The three bedrooms got wall to wall new carpeting to match the living room, and the full bath/utility room and half bath in the master lost their dark carpeting and horrible smell (don't put carpeting around a potty, people) and received the same tile as the kitchen/dining combo.  By using the same carpeting and tile throughout, we made this house come together in a unison of harmony. We also added a light kit featuring 4 lights to the fan in the master, as before - just like the living room - there was NO light.  Never have I seen that before except in my son's house.  Go figure.

Now today the "for sale" sign goes up, the lockbox goes on, and this home is ready to welcome a new family to make 48 more years of wonderful memories.

I love redecorating - painting is my thing, trying new ideas like the Bermuda Bronze backsplash to create a new vibe feels great, and trying to be economical and not break the budget is a challenge I enjoy meeting.  So if you know someone looking for someone to transform their tired, outdated living space, tell them to call Judy Dendy, at Prudential Ada Realtors.  I not only sell real estate, I transform it into the 2013's mode.   806-672-3082.  I'm ready to start a new project, and I won't break your bank account. 

Making a Splash with Antiqued Tin!!

I have been redecorating a 1960's home for an estate here in Amarillo the past few weeks.  It was a very dark home with paneling in the living room, hallway and two bedrooms.  We decided to keep the paneling in the two bedrooms in case a day sleeper bought it.  But we painted the paneling a light cappuccino white and all the woodwork marshmallow white for a contrast and we are putting in a white tile with a green diamond in the middle in the kitchen, and baths.  The carpets are a light cappuccino also, and this home is going to really be light and airy.

Another problem we faced was that there were fans in the back bedroom and living room BUT NO LIGHTS.  Really, I'm not lying.  No lights in two rooms of the house.  So I bought light kits for both and then the electrician tells me that the fan in the living room is self-enclosed and can add a light kit.
I could have bought a new fan with light, but hey, if we are trying to make this house lighter and more moderns, why not canned lights.  So we added 4.  This really brightened up the living room.

The major place it is lighter is the hallway that was a paneled dungeon before.

But the thing I am most proud of is the splash in the kitchen.  We chose the Bermuda Bronze faux tin ones from Home Depot.  These are easy to cut to trim into place with scissors, and we used double-sided tape that is sold with the tin sheets.  However, I think after seeing it three days later, I might get some pretty little nails and nail the edges down so there is no bowing or bending.  This splash just sparkles.  Today I put gloss on the cabinets, and I'll do another one tomorrow and then Monday the tile and carpet goes in.

I will then post a picture of the finished product, but I can't wait to show you the splash so here it is:

 

I think the stove is about to be replaced too as the door fell off after this picture was made.  So Monday night I will try and post pictures of the finished room and maybe of some of the other changes.  I'm just so excited that the SPLASH made such a splash with the owners; who all think it is amazing!! 

 

I'm really enjoying this redecorating and hope to get more jobs in the future.  I hope my experience selling real estate will help me choose those items that buyers look for the most in a home and incorporate those items in the redecorating so that the homes sell faster. 

 

I will be listing this home for sale on Tuesday, so I have a vested interest in this being a great redecorated home.  Tonight I am working on an art project for the dining room to join a gorgeous tin metal mirror I got in Lewisville on a recent trip.  By bringing some of the tin into the dining room which adjoins the kitchen, the tin shiny theme can be continued and it looks like they are meant to be together.  I might do something for the living room too as this is kind of an open concept living/dining/kitchen combo. 

 

Hope you enjoy my redecorating story, and call me if I can help you too.  I can work on a very tight budget!!

Inventory is Low

It is time to SELL your property if you have been waiting.  During the recession we had over a year's supply of inventory on the market, but now we are down to 4.1 months.  Also home prices have risen, and you may be surprised at how much you could get today.

I sold a house in January in a subdivision for $218,000; sold almost the exact same house last week except for an additional garage stall and an extra 1/2 bath for $250,000.  Exact same square footage, same subdivision and only 2 streets apart.  This shows the increase is happening rapidly. 

So if you've been on the fence about selling, now is the time to jump into the market while it is HOT and a seller's market for the first time in years.  Plus the interest rates are still under 4% so you could move up cheaply or downsize to a great new payment.

Be sure you list with a realtor that has a large online presence, as 100% of buyers say they start online looking before calling a realtor.  My company, Prudential, has over 20 website presences your home would be presented on.  We have a proven track record for sellers' satisfaction. 

If you live in Amarillo, give me a call at 806 672 3082.