Here are some of the points you need to consider when you plan to

take out a home loan for the first time with blemished credit and no down payment:

1. Approach a loan provider: You need to find a lender who is interested to offer loan to the borrowers with bad credit. Make sure you find out about the financing requirements along with the documentation required to apply for the loan. Therefore, you need to take out the credit report in order to qualify for the loan. Try to provide evidence of your income and ensure that you’re able to repay the owed amount.

2. Send the documents to the loan officers: Once you have compiled the required documents, make sure you send the required documents to the loan officers. They can help to guide you in the qualification process if you provide the right documents. Remember, the process is really lengthy, so if you provide the required information you can manage to get the loan with ease.

3. Acquire evidence of your payment history: You can keep a record of your payment by keeping a copy of your rent payment, electricity and utility payments. You can go to the lenders in order to show the good payment history.

4. Apply for loan with a hardship letter: You can apply for a loan along with the hardship letter. If your credit record ruined due to extenuating circumstances, then write a hardship letter explaining your situation to the loan provider. The lenders may agree to provide you loan but on higher interest if you have genuine reason

behind your credit default.

5. Find out about down payment: Make sure you find out more about down payment from the loan officers. Ask him about down payment assistance programs and regarding financing programs. Make sure you acquire more information on the rural development program like NACA and USDA to get qualified for the loan with poor credit.

6. Take help of a cosigner: If your credit report is blemished, then you can find out a cosigner with good credit. Your cosigner’s high credit score can help you get a loan on favorable terms. You can start the qualification process with the use of your co borrower’s information in order to get a home loan.

Therefore, you need to keep the above mentioned points in mind when you plan to take out a new loan on favorable terms.

For these under-marketed homes, I bring my experienced buyers to try to buy below full market price. It’s great for buyers, but if you’re the seller, then you’re leaving money on the table. Don’t be that seller. Market your home properly and get every dollar possible.

Picking up where we left off from “How to Sell Your Home for Top Dollar – Part 1″, let’s continue on the to-do list:

4) Be an attention grabber:

Being listed on the MLS puts your home in front of an enormous audience right away. But to really capture attention, here are a few tweaks that help your listing stand out. The first day on the market is critical. That’s when search alerts are triggered for interested buyers. Most people tend to spend more time checking out listings toward the end of the week, right before open houses on weekends. In fact, studies have shown listings that come on Thursdays and Fridays sell for higher prices than those from any other day of the week. Then, if buyers do happen to see your listing, make a good first impression with the first photo of your home. If you don’t have a photo, buyers don’t know what home style or condition to expect and will skip to other listings. A picture is worth a thousand words and in the case of residential real estate, many thousands of dollars. So make it count.

5) To fix or not to fix:

If you’ve lived in your home for a while, you probably have a laundry list of upgrades, repairs, and maintenance items that you’ve been putting off. When preparing your home for sale, it’s time to take stock of those tasks. While home improvement projects usually add to your home’s value, they don’t offer the same returns. Small repairs offer the best returns so tackle them first. Fix cosmetic cracks, leaking faucets or broken window screens. If your home looks poorly maintained, buyers tend to suspect there are bigger issues hidden beneath the surface. After the easy fixes, consider bigger projects like interior painting, new carpets or new kitchen counter top. Keep your color and style choices neutral or you achieve the negative effect. For major renovations, you should sit down and discuss with your Realtor. The last thing you want is to be over-improved for your neighborhood.

6) Staged for success:

No home is perfect, but with the right staging, your home will feel perfect to the right buyer. Buyers are not interior designers or real estate professionals and don’t look at vacant homes all day long. It’s hard for them to imagine an empty space furnished and lived in. Unfurnished, rooms tend to look smaller. Staging helps buyers understand the space, visualize how they will live in the house and hopefully fall in love with it. Staging warms up bland spaces to be homey and cozy. Most important of all, staging draws people’s attention away from any defects and makes a home look more updated and better maintained. While you shouldn’t try to hide major defects with staging, if your house is totally vacant, buyers have nothing to focus on but uneven patches on the wall.

Get these elements right and you’ll be happy with the way your home sells.

For most of 2012, the local housing recovery was being driven by first-time homebuyers and investors.  Many potential trade-up buyers remained on the sidelines in 2012 as their current homes were underwater or they struggled to come up with enough equity towards the next home.  Now, with home prices up by 20% or more from 2012, many homes in the South Bay have recovered back to prices last seen in 2005, restoring equity for the homeowners.  If you are one of those homeowners and would like to trade up to a bigger, better home before prices once again climb out of reach, this year is your window of opportunity.

To maximize your buying power, you need to sell your current home for the most you can get out of this hot market.  With so much demand, homes easily get dozens of offers without much effort.  However, to fetch the top dollar in such a fast moving market, you need to have a clear strategy, just two words:  pricing and marketing.  The concept itself is very simple, but the difference is in the execution details.

First, let’s talk about pricing.

1)      Timing is everything:

Real estate is seasonal.  While each house and transaction are unique, sale prices are still largely governed by larger trends.  There are a lot more buyers in spring and summer than in winter, when inclement weather and holidays keep buyers at home.  Hence, in a stable market, median home prices can vary as much as 15% higher in summer than in winter.  Of course, some of the increase is also due to the higher quality of homes available in the summer.  When the market is in transition as it is now, prices are more in flux.  The market conditions must be monitored closely and constantly to know the exact moment when your home can hit the very top of the market.

2)     Know past and current sales:

The homes sold nearby determine the fair market value of your home.  These sales are called the sold comparables, or sold comps for short.  If there are recent favorable sold comps in your vicinity, that will drive up the short term home prices and make it a favorable time to sell.  Vice versa, unfavorable sold comps or lack of any recent comps will make your fair market value murkier. Homes currently on the market are important too as they are your direct competitors.  Buyers will compare them side-by-side and usually proceed on the one that is of higher quality or value.  So, get to know your competition and highlight the relative advantages of your home.  Price accordingly.  Make sure that your marketing strategy makes your home stand out to attract the most buyers.

3)     Price it right:

Pricing is an art.  The fair market value has to be determined first.  However the asking price does not necessarily equal to fair market value.  The initial asking price provides the important first signal to the market and to the buyers.  If the home is priced lower than fair market value, it tells the buyers that the owner is willing to deal.  This attracts multiple bids from value-seeking buyers and drives the price up.  Or, if the home is priced higher than fair market value, it tells the buyers to expect a high quality home, not a fire sale.  There will be fewer bids, but the right buyer will appreciate the quality and make a fair offer.  Whether you play the low or high strategy, the key thing is to avoid pricing yourself out of the market.  An unreasonable asking price makes homes sit on the market for weeks or months.  Once the listing goes stale, buyers lose interest and tend to undervalue the homes and you end up with less than the fair market value.

Now that you have come with the right price and sell it at the right time, you are half-way there.

We will continue on how to market your home right in the next section.

1.  Buying properties in unfamiliar markets

This is a very common mistake, one that speaks to the low-hanging fruit nature of novice investing in any asset class.  If you don’t know where to start, you tend to go with whatever your neighbor or somebody on TV tells you.  It’s not a good or bad idea — it’s just higher risk when you can least afford it.  The headlines are always attractive, but if you don’t know the market, you don’t know if you’re getting one of those advertised deals.  You can be in the exact same market as the winners and end up in a dump that happens to be on the wrong side of the street.

2.  Underestimating expenses

Real estate is a complex asset class.  That complexity offers opportunities for the experienced and pitfalls for the novice.  As an investment category, there are a large number of possible expenses that a first-time investor would not be aware of or know how to properly calculate.  Just on taxes alone, there are transfer, supplemental, and property taxes.  On the often touted foreclosure deals, there could be hidden liens, litigation, or undisclosed structural issues.  Usually, these unknown expenses are learned through expensive trial-and-error, the same process that real estate brokers and their salespersons go through on a daily basis.

3.  Accepting negative cash flow

Less common than in the boom days, first-time investors still think that investing in pricey California means they have to accept no cash flow and even put money in to support the investment.  These investors hope that appreciation returns will offset the negative cash flow and bail out the investment in the long run.  Often, this means they’re investing in “good” school districts and in nice single family homes.  While it is possible to make money in the long run with this approach, the overall return would be less than that of a positive cash flowing property, which would also appreciate.

4.  Underestimating the competition

Unlike competing with other home buyers, competing with property investors is a whole new game.  Many property investors do it professionally and they know all the tricks of the trade.  They’re well prepared with their finances and have a experienced team of lenders, lawyers, and contractors.  So, just because a property is a distressed short sale or bank-owned unit, it doesn’t mean you can instantly capture the discount by bidding at the below-market list price.  Winning deals, especially in the currently hot real estate environment, takes effort and a bit of old fashioned cunning.

5.  Going without an Investment Realtor

This is probably the most serious mistake.  Yes, it seems elementary to just buy and rent a property, but that’s the 30,000 foot perspective.  Success in property investing depends on proper execution on every step of the process — understanding market conditions, finding the right deals, winning those deals, making the profitable improvements, getting the right tenants, and managing the property.  If you go on your own, there are dozens of ways to make a costly mis-step.  Even if you work with a regular buyer agent, you’re still left with figuring out how to deal with the property after you’ve purchased it.  Regular buyer agents just want to sell you the property and have no accountability for delivering the rental returns.  It’s very easy to sit six months or more on a vacant property without the right management.  Flipping property is a whole other story, with even more challenges.

So if you’re considering becoming a property investor, make sure you’re educated on these issues or have the right guidance along the way. If you need help in the Bay Area or have any questions, drop me a line (650-275-2594) or send me an email (michael@archershomes.com)

1. Unlawful discrimination-

Many landlords have personal preferences for certain tenants. If you express, even implicitly, some non-financial criteria, you may run the risk of unlawful discrimination. It is common knowledge that it is unlawful to refuse to rent because of a person’s race, gender, sexual orientation, age or disability. Lesser known ones are familial status and source of income. For example, you can’t restrict tenants to adults only. And if you have a tenant with a disability, then you have to make reasonable accommodations for them, such as installing handicap handrails or allowing service dogs. If you represent the housing as unavailable when it is, in fact, available that constitutes as refusal to rent as well. Carefully exercise fairness and honesty when responding to all inquiries.

2. Inadequate disclosures-

California law requires landlords to disclose the presence of hazardous materials to tenants, including but not limited to lead-based paint, asbestos, pest control treatments, carcinogenic material and methamphetamine contamination. Just like in sales of residential real estate, if there is a death in the unit within the last three years, the landlord needs to disclose the manner of the death. There are also less common cases that require disclosures, such as if the unit is in rental conversion or if the unit is within one mile of military base with ordinances. You have to keep yourself informed constantly on what need to disclose as new disclosure requirements may be enacted.

3. Lease termination and eviction-

This is one area which has triggered the most litigation. California law has well-defined guidelines on the process and the minimum number of days required to proceed on each step. For starters, landlords have to give a 60-day notice for lease termination should the tenant have occupied the unit for over a year. A 30-day notice is acceptable if the occupancy is under a year or if the landlord intends to sell the house and has opened escrow. If you need to evict any tenant as he fails to pay rent or for other reason, then you file an unlawful detainer lawsuit. It is a complicated procedure and you need to follow it to the letter.

These are the top pitfalls that you should watch out. If you want to be a successful landlord in the long run, you should consider retaining the service from a property management company. That will save you a lot of headaches and troubles.

Disclaimer: The above statements are provided for information only and are not to be construed as legal advice. Anyone viewing the information should not rely or act upon the information without seeking professional counsel. It is not intended to constitute legal advice or to substitute for obtaining legal advice from an attorney licensed in your state.

a new trend of mortgage refinance by the underwater homeowners. This is because rates of 30-year fixed rate mortgage (FRM) were moving at an average of 3.36% that fell from previous rate of 3.4% earlier, as per the reports from Freddie Mac’s survey of mortgage lenders. These cheap housing loans have given birth to the largest mortgage refinance boom since the year 2009. Most of the underwater homeowners are opting for 15-year fixed rate mortgages in order to repay their loans well before they retire.

However, the question arises that whether or not refinancing mortgages at current rates will be beneficial for these people in the long run.

Benefits of refinancing

Here are some of the reasons that may convince people about the necessity of a mortgage refinance:
Mortgage rates – Borrowers can lower the rate of interest levied on their loans significantly, by refinancing them with present mortgage rates. For instance, people who are paying their mortgage loans at a 5.25% rate should readily opt for the present rate of 3%. Moreover, if one can get the deal without any hidden costs or upfront lender fees, then he/she should consider it a without a second thought.

Mortgage amount – As a result of a reduced rate of interest, monthly mortgage payment amount will also get lowered. Hence, people will be able to rebuild their home equity since it will become easier for them to stay current on their payments by the virtue of a comfortable repayment amount.

Mortgage relief – Refinance will help them to retire with less financial obligations. This is because borrowers can add up extra amount from their savings to make bigger payments every month that will help them to pay off their loans in less than 5 years. Due to this effort, people will be able to save thousands of dollars in interest paid on the loans.

Mortgage conversion – Borrowers will be able to convert their mortgage loans into a more suitable type of mortgage based on their financial condition. For instance, borrowers can switch over to an adjustable rate mortgage from a fixed rate mortgage in order to lower their debt burden and vice versa.

Therefore, refinance will be a judicious choice for every borrower given the current low mortgage rates. It is especially advisable for people with 5% or higher interest loan. However, one should calculate the breakeven point before deciding on a refinance loan. This means that borrowers need to count the closing costs (if needed) and divide it with their monthly savings in order to learn about the possible time it will take them to build up a fresh retirement fund.

Besides the above reason, borrowers should be cautious about their choice to switch over to a shorter-term loan with the present low rates. This is because short term loans have bigger monthly repayment amounts that may not be possible for them to meet, in case of a financial crisis.

Coming in two phases, the site planners at Station 361 have smartly lined up a tight row of townhomes right along the CalTrain track, creating an effective sound wall and sight-line separation for the more upscale single family residences.

The townhomes come in two floor plans of about 1700 sqft. They offer 3 bedrooms on three levels but come with side-by-side 2 car garages, making them similar to the just completed development at Mondrian just down the street.  At a starting price point of about $800K, these townhomes are very competitively priced for their Mountain View location.

The single family homes offer much more variety in floor plans.  They go from a quaint 2 bedroom cottage with less than 1100 sqft and a 1 car garage all the way up to a substantial 2400 sqft, 4 bedroom executive home with a loft and courtyard.  Since the single family residences have larger lots and better locations than the townhomes, their prices are commensurately higher, with the smallest home starting at just above $1M and the largest in the $1.5M range.

Consistent with the premium standard features of other Classics communities, the homes at Station 361 come with hardwood flooring, stainless steel appliances and granite countertop as standard features in the kitchen and includes hardwood cabinetry throughout.  Combined with all the other standard features, the homes are a great value for the location.

And, you don’t have to take my word for it.  The homes at Station 361 are so highly sought after that buyer aggressiveness reached unheard of levels, even more than during the heights of the last bubble peak.  The demand surprised even the builders as almost all of the 20+ homes in the first half of the project sold out within weeks, months ahead of schedule.  There may be something of a tech IPO effect or just a rush of cash buyers.

At this point, waiting lists are building up once again as buyers anxiously wait for release of the remaining homes, which is likely to be at the end of the year or even early 2013.  With such pent up demand, the next phase will likely sell out very fast.

Update 10-8-12:  There are currently 2 remaining units available.

Update 10-16-12:  Two model homes were released.  There are currently 3 remaining units available, including a single family home for under $900K.

If you’d like to find out more about these units or are interested in the next release at this community in 2013, feel free to call (408-320-5261) or email me (tinalam@archershomes.com).

These 2 and 3 bedroom townhomes range from 1440 to 1671 sqft on three levels. Like Classic’s townhomes at Encinal, the Tasman Crossing townhomes come with the same features that make their homes so popular:

- All units come with side-by-side garages instead of tandem like other communities.

- True townhouse style construction with air-gaps to separate each unit for complete privacy.

- Fully featured with hardwood flooring and granite countertop in kitchen as standard.

With prices for new Sunnyvale townhomes jumping by 20% over last year, these townhomes at Tasman Crossing offer a compelling value. Since I sold 2 of the last remaining units at Encinal, I expect this very limited collection of 17 units at Tasman Crossing will go quickly once they’re available.

If you’d like to find out more or are interested in getting a first shot at this community, feel free to call (650-275-2594) or email me.

Update 11-1-12: The opening date for the community has been delayed. It now appears to be near the end of 2012. Initial release prices are being revised as well. Check back for further updates.

Late in 2012, the mystery was finally revealed. It’s KB Home’s brand new community of townhome-style condos called Vicino. Vicino offers an interesting twist to urban living. On one side of the narrow lot is an established community of newer single family homes with great curb appeal and across the street, it’s a row of older ranch homes. On the other side you have the 280 sound wall and a San Jose City fire station. Finally, at the backside of the lot, you’re bordering Frank Santana Park. So, you get much of the feel of the single family living experience with the neighborhood feel and a generous city park combined with modern styling and the low maintenance of condo ownership.

At the far end of the lot, you are within walking distance to Santana Row, one of the most popular destinations for all of San Jose. This proximity is perfect for urbanites, since all the shops, restaurants and bars are just minutes away from your doorsteps, which is especially great for late evening outings.

The floor plans are typical of KB Home’s pragmatic style. Most are 3 story townhomes with side-by-side 2 car garages. Amazingly, there appear to be four units planned which are 2 story townhomes, a very rare find for new homes in the south bay. The 2 story floor plan offers a very desirable layout with the main living area right on the first floor and the bedrooms on the second floor. Otherwise, the floor plans range from 1459 to 1812 sqft and base prices start from the high $600Ks to the low $700Ks. The HOA fees are also quite reasonable.

At the moment, there are no model homes yet and the sales office is in a temporary shared space with Intero in Santana row. Priority reservations for well qualified buyers are being offered with each release. Few, if any, units will be available to the general public. If you’d like to find out more about exclusive deals available or interested in getting a priority reservation in this community, call Michael (650-275-2594) or email (michael@archershomes.com).