Pros and cons of buying foreclosures

The lure of buying a foreclosure property can be very strong. It is one avenue for getting a good price on a property. I always like to caution the casual buyer, however, because the potential pitfalls are significant. Daily Real Estate News has this to say:

"Here are some prime considerations for anyone wading into the foreclosure market.

Avoid outstanding liens. Make sure the property has a clean title. Any outstanding liens and fees incurred by the original owner will be transferred to the new buyer.

Bid conservatively. The market in many places is still depreciating. That unknown added to transaction, repair, and marketing costs could sour the deal.

Beware foreclosure concentration. Prices in neighborhoods where there are lots of foreclosures have declined the most – and prices in these areas are still declining. A buyer should confirm that there’s an opportunity to make money if prices fall another 15 percent.

Beware the appraisal. If the price is discounted from an appraisal done before August 2007, it is almost certainly unrealistically high.

Cash is king. Even a buyer with a renter lined up and enough money for a 20 percent down payment needs still more cash to weather another two or three years of a depressed market before unloading the property."

If you still want to consider purchasing foreclosure property, you can get information about them on my website: www.AliceKuder.pnwRealty.com Click on "Search for Properties" on my homepage, then click on the "Foreclosures" tab at the top of that page.

Want free airline miles? Buy a house!

If you love to rack up those free air miles AND you're planning on buying a home soon, you may want to ask your lender if they offer travel miles as a perk.

There are many lenders including LendingTree, Washington Mutual, Wachovia and Chase who will give you 1,000-1,300 air miles for each $10,000 of your home purchase loan amount up to a maximum of 25,000 miles. Programs vary, depending upon the lender and air carrier. E-Loan will give 1,250 miles for every $10,000 borrowed on a home equity line of credit, refinance or purchase.

In a residential transaction, home buyers can receive 10,000 miles for each $100,000 of the home purchase sale price when using an approved participating real estate agent. Affinity companies, including Tacoma-based Miles4realestate.com, say the miles provide an innovative real estate marketing opportunity with absolutely no risk to the seller. Still, you may want to ask your lender if there are any extra fees wrapped into the loan to pay for those air miles.

Interest rate update

Here's a recap of the week by loan officer, Troy Chambers, of Arboretum Mortgage:

Unfortunately, rates have risen once again … However, I think we have seen the worst of it, and I believe they will settle back down. As we see fixed rates in the mid 6’s, we need to remember that these are historically very low, and should not be preventing people from purchasing. If you or anyone you know is seeking mortgage advice or is need of a pre-approval, please call my cell at 425-418-5103.

Troy Chambers
Loan Officer
Arboretum Mortgage
Phone: 206-720-6628
Fax: 206-860-9340
troy@arboretummortgage.com

Click here to view a chart of loan rates.

May home sales stats are in

King County home sales statistics for May 2008 are now available from the Northwest Multiple Listing Service. Click here to see a comparison with the same statistics from 2007.

I publish this information every month in a couple of different places. First, I send it to all the folks on my mailing list (let me know if you'd like to be added). Second, I post the info on the home page of my Prudential website, www.alicekuder.pnwrealty.com.

Here's something you don't see every day!

While previewing newly listed homes the other day, I came across this wonderful old stove/oven. They just don't make them like that anymore! And, yes, it really is pink.