Underwriting is Getting Tricky!

We have about eight sales pending and all but one have had challenges with underwriting. It's not that the underwriters are denying loans, but they ask for more and more information and substantiation before approval. Underwriters ask for banking and deposit information to assure the lender that buyers are not borrowing down payments and that there are sufficient funds to close, and then ask for the information again later. Pay checks have to show 30 days and one of our clients showed 28 days... She is paid every two weeks. 14 + 14 = 28. Not good enough.

Water tests, septic pumping, reinspection after the storm, repairs made to properties with receipts and certification of repairs. The list goes on and on and on!

What is the solution? Keep giving the loan officers what they are asking for; plan that they will ask for the same thing more than once; and plan a realistic period from contract to closing. Especially be realistic about the time it takes to get full approval from the lender. Have faith that if your lender has given the buyer a preapproval; that nothing big changes in your financial picture; that if the house/condo appraises and buyers and sellers are working together to make it a win-win, then the loan will eventually get approved. DON'T buy a car or boat or charge furniture on your credit cards!

It is frustrating for buyers and sellers, but REALTORS are here to help. We've even scraped and painted a house to get the loan approved! Hang in there and have a Plan B -- which is that the loan approval date might need an extension and the closing date might need to be moved also. In the end, you'll be able to move into a great home -- or sell a home and start a new chapter in your life.

After the Hurricane

I'm feeling really blessed these days because in Burlington, where I live, we just got some moisture in our basement in the aftermath of the hurricane. All we need is a dehumidifier to take care of the dampness. But we are seeing and hearing about such terrible destruction, that I feel very lucky that we didn't have damage.

Tonight, a friend from Waterbury said houses in the South Main area were pulled off foundations. Houses that were for sale a year ago -- houses I showed buyers -- were devastated. Water throughout the first floor, belongings now strewn on front lawns. Another family had water in the back yard, moving toward the house. In five minutes, it was on the front lawn. She grabbed her kids and in the time it took to get their coats on, the water was so high she had to carry the two of them and slog through thigh deep water!

All of our loans are going through an appraisal reinspection to make sure the hurricane did not destroy the house that banks were about to loan money on! I understand the reason why but most of our loans are closing late because of the reinspection. We are now telling buyers and sellers to expect delays.

I guess if it's a delay versus losing a house, I'll take the delay. And I am very thankful that all I have is a damp basement.

Curb Appeal on a Dime

I saw a house the other day that was a simple cape style with no dormers. Instead of the typical cape with a center door on the front, this door was on the side of the house. When you entered the yard, you saw the broad side of the house with two windows and nothing else. There were stairs on one side that brought you to the main (side) door and a small deck just before the door.

In front there were remnants of a flower garden but they were more weeds than flowers. Nothing much grew on that side of the house.

Here's what I suggested: 1. At the bottom of the stairs going to the door, put pots of chrysanthemums. Put more at the top of the stairs on the deck for a total of four. Claussens on Rte 2A in Colchester Village has great chrysthanemums every year.2. Edge the garden in front of the house and get hostas from neighbors -- everyone has hostas to share at this time of the year. Plant hostas in the front of the house and mulch the heck out of the area around the plants. Mulch anywhere they want to create more beds. 3. Then put window boxes under the two windows and fill them with annuals -- over plant because there isn't much time left before a frost so they won't grow.

Cost:
Chrysanthemums: About $60
Window Boxes: He can make out of scrap lumber so they are free
Flowers for window boxes: Go to Lowe's and buy annuals on sale: $15
Mulch: $50
Hostas: Free
Total: $125
What will the return be? This small investment could mean the difference of someone wanting to buy the house or not!

Easy to turn a plain Jane house into a fabulous house with a little money and imagination!

Walk Through Before Closing

The standard Vermont Purchase and Sale contract allows for buyers to do a walk through of the property they are buying within 24 hours of closing. What happens at the walk through?

First, the contract calls for the house to be broom clean and free of occupants and personal property. So, that is the first thing to check for. If there is stuff in the house, we'll call the other agent to see what the seller's plan is to remove the belongings. We might give them a little time to come back to get their things, or at closing, money can be put aside to insure the belongings are moved.

If any work needed to be done for the contract, we confirm that it has been completed. We check appliances to make sure they are working. We flush toilets, run water in the sinks and showers, and make sure there are no leaks. We turn on the heat and make sure there is hot water.

Strange stories in walk throughs: The refrigerator didn't work and it was full of food. Yuck. The garage was full of paint cans that were supposed to be moved. They had to come get them. A box of vinyl siding that was to be left was removed. The sellers brought it back. The electricity had been shut off prematurely and so the house was not cleaned. The sellers were charged for cleaning fees.


The walk through is the final opportunity to see the property you are going to buy and make sure everything is working. If the refrigerator breaks after closing, you have a broken refrigerator. That's why we check to make sure before closing!

Referrals Through Real Estate

One of the benefits of being in real estate is finding trades people to refer to clients and customers. I am currently looking for a good sheet rocker and put out a voice mail in our office and received two names. I also called a contractor I used in Grand Isle and he gave me a third name. I have painters, plumbers, electricians, fine carpenters, rug layers and general contractors. It is great to be able to refer clients to trusted trades people.

In addition, I enjoy using clients and customers for jobs or services. I have a great stock broker who has referred me to many buyers and sellers. I love giving his name out. I have given out the name of a good chimney mason who does great work lining chimneys and fixing problems with crumbling bricks. He referred me to his sister when she was selling her house. I have a local carpet store that I work with all the time. One of my friends and clients does decorative painting. The list goes on.

These people will practically drop what they are doing and find time to help a client of mine or to help me. They know they receive a lot of referrals from me and I know they do great work. We are mutually loyal to one another!

Would you like names? Just let me know. And please send me the names of people you have used. It's always better to have a personal referral. It's a great benefit to my clients and customers.

To Landlord or Not to Landlord

We bought a duplex in St. Albans in 2005 for $155,000. It seemed like a good idea -- buy a house that needed a lot of work, buy it at a low price, fix it up and rent it. We put in $15,000 in the first few months, rented it and made a positive cash flow of about $300 each month.

The house was in rough shape but not terrible. When we bought it, there was a goat in the living room. Yes, a goat. When the goat was gone, we refinished the wood floors, painted walls, fixed holes in the plaster, and put in new carpet.

With each changeover of tenants, we had to go in and do varying amounts of work. One set of tenants left the apartment so disgusting, we had to rip up all the carpet and put down new, put new floors in the bathrooms, and hire someone to clean it for about 8 hours.

One set of tenants stopped paying and we had to go to court to evict them. We lost $3,000 in rent and legal fees, not to mention a lot of sleep. It was very scary because I built the situation up to being a horror movie in my mind and thought the tenants would come kill me! Dramatic, I know, but I had no other experience and so my mind went to a dark place.

The last tenants did $1100 in damages with a $750.00 damage deposit. Worse, the police came to the apartment often, my neighbor called constantly complaining about the noise, and the fire department came for an oil fire that happened by accident.

I thought this duplex would be a great investment but real estate in St. Albans has gone down . We would break even on the price we paid but not for all that we have invested in repairs and updates. Plus, we have to get new tenants nearly every year. This is taxing and expensive.

Would I do it over again? No, I wouldn't. I don't think I have the personality anymore for being a landlord. I don't know how people who own multiple properties do it.

So, as soon as the market recovers in St. Albans, we're putting a for sale sign up!

Life Long Friends Through Real Estate

I first met Joe and Cheryl when I helped them find a home in Vermont. We had lots of lunches together and enjoyed seeing houses until we eventually found the perfect home. We just clicked. And we became friends.

I met one of their daughters, Jessica, during the house buying process. I loved her wise cracking personality and her love of life! Then I found out she was in recovery from breast cancer that she discovered at 21. When she found out she had cancer, she was an undergraduate at UNH and went through chemo and radiation and then graduated in the nursing department.

Jess became a nurse at Fletcher Allen in Burlington, ran a marathon to show she had beaten cancer, and married Riley. She and Riley enrolled in Nurse Anesthetist School in Maine. Then her cancer came back.

This past Saturday, July 23, I ran in the Susan G. Komen Race for the Cure in Manchester, VT. This race encourages participants to raise money to help cure breast cancer. This was the 8th year I participated. Last year, I ran in honor of Jessica. This year I raced in memory of Jessica. She passed away last November at 26.

In real estate we sometimes have relationships that are only professional. We help people buy or sell homes. And sometimes we become friends and they let us into their lives and we in ours. Cheryl and Joe will always be my friends.

This is why I love what I do every day.