January presented us with major changes to mortgage lending rules. These new guidelines aim to curb some of the excesses that occurred during the sub-prime years—hopefully resulting in a lower risk of default and foreclosure by borrowers and a healthier real estate climate for everyone.

QM: “Qualified Mortgage”

This all came about as one offshoot of the Dodd-Frank legislation that went into effect in 2014. It creates a new category, “Qualified Mortgage.” Lending institutions are required to document each loan they deem to be a QM; when they do, they benefit by being able to sell them to Freddie Mae and Fannie Mac, and are protected from legal action in the event of a future default.

The reason that these changes won’t keep most borrowers from getting a loan is that loans that don’t qualify (“Non-QM” loans) will still be offered by some banks—they’ll simply keep them on their own books.

Ability-to-Repay Rule

The bedrock requirement for a QM is an evaluation of the borrower’s debt-to-income ratio. That’s the projection of debts divided by income on a month-to-month basis — especially important when getting a loan with a variable interest rate. If it seems to you that this calculation makes common sense for any loan—I’m in your camp! The reason a bank might choose to issue a loan that does not meet the letter of this requirement could be their analysis that the percentages dictated by the rules are too strict for a particular borrower.

Risky Business

A Qualified Mortgage can’t have any of the risky factors that were hallmarks of the mortgage meltdown. Included are “no” or “low-doc” loans; loans with terms longer than 30 years, interest-only loans, and those with minimum payments that don’t keep pace with interest rates, causing the loan balance to increase.

So: what’s the bottom line for buyer’s intent on getting a loan this year?

The good news: most loans will go through as before (estimates are about 95% of them). But more paperwork and longer processing times are likely, and since fees and charges for a QM cannot exceed 3% of the mortgage, getting a smaller loan might become more difficult if banks determine they can’t make a profit.

In any case, coming prepared is still the best insurance that your loan goes through as smoothly as possible. If you’re looking to buy a home in Evansville this season, I’ll help make sure your preparation is first-rate! You will be able to take advantage of my extensive network of different mortgage providers in order to make the purchase of your new home as seamless as possible. You can reach me on my cell phone at 812-499-9234 or email Rolando@RolandoTrentini.com

With cars, TVs—even watches—getting connected through WiFi and wireless telephones, it’s small wonder that “Smart Homes” are here, too. According to Forbes, companies offering smart homes technology will be a $35.6 billion industry within just three years. They already offer homeowners an array of connected appliances, security systems and even HVAC systems.

From what I’ve seen, their marketing has highlighted the convenience factor—but if that seems to be more sizzle than steak, here are some surprisingly substantial reasons why you might consider upgrading your own place into a smart home:

Your current security system gives you peace of mind whenever you’re out of town. But have you ever wondered whether you remembered to lock the back door? Smart homes let you click a function on your phone that commands the home to lock itself! The same app can also send you a live video feed of the interior and exterior of your home.

In addition to securing the premises, smart homes can help you prevent home accidents. Smart appliances can be controlled via mobile apps which allow you to turn off ovens, stovetops, microwaves and even washing machines from anywhere you establish a WiFi connection. This minimizes the risk of the kind of home fires which can be caused by unattended appliances. (If you’re thinking that homeowner insurance premium discounts may soon be offered for connected homes: the Wall Street Journal reports that they already are!)

Major manufacturers GE, LG and Samsung have introduced complete lines of connected appliances controlled via mobile phone, eliminating the need to physically get up to adjust settings. Think how, especially for the elderly and handicapped, this would meaningfully enhance their quality of life—maybe even extending their ability to live at home without assistance. For all age brackets, being able to effortlessly control lighting, heating and air conditioning at the touch of a device screen will inevitably result in practical energy savings; and that raises perhaps the most important selling point for smart homes technology—

Increasing the value of smart homes when they come up for sale. The practicality of smart homes is already especially appealing to the growing number of tech-savvy buyers.

If you’re comparing home upgrades prior to putting your own  home on the market, I’m here to help you choose which (if any) are likely to add the most value. Call me anytime to discuss your short and long term plans! You can reach me on my cell phone 812-499-9234 or email: Rolando@RolandoTrentini.com

One of the unusual situations that sometimes crops up in real estate is one where the buyer purchases a house without ever seeing it. This may sound nuts—but there are circumstances (more than you’d think) where it can be the only practical solution.

Wholesalers and house-flippers, for instance, sometimes simply haven’t time to visit every property they suspect is a great buy. Other times, buyers might be relocating to Evansville from out of state (or even out of the country) under a timetable that doesn’t allow them an extra visit—or even a first visit! According to the latest full-year data from the National Association of Realtors^®, home sales to foreign buyers amounted to $68 billion!

As you’d guess, the risks of purchasing a house sight-unseen when relocating to Evansville remain stark. Nonetheless, there are ways such buyers can protect themselves: 

Adding a contractual walk-though contingency—one which allows a final walk-though before signing at closing—is the surest protection. Sellers aren’t obligated to accept such a contingency (and in a competitive market it’s less likely to be acceptable), but if it’s allowed, it’s also a sign that the property is likely to pass muster.  

The odds of a good “sight-unseen” result when relocating to Evansville grow significantly better when you present your agent with a clear list of requirements. Some important factors outside of specific house metrics could be the quality of local schools, transportation links and commuting times, crime rates, shopping and entertainment and recreation area access.

It is especially important to hire a first-class home inspector. When you can’t visit the property yourself, your inspector can be the trained eyes that prevent your inheriting unneeded maintenance issues. If the listing doesn’t give you a clear idea of how the home is laid out, requesting a video of both interior and exterior of the property is a good idea. If one isn’t available, don’t be shy about asking your agent to make a walk-through video for you.  

For anyone relocating to Evansville when a ‘sight-unseen’ home purchase is necessary, choosing the best-qualified Realtor and inspector couldn’t be more important. In that situation, they become your ears and eyes on the ground! Please feel free to call me at 812-499-9234 or email Rolando@RolandoTrentini.com and I will be more than happy to assist you with your real estate needs. Our motto is “With an Accent on Service”

Part of the recovery in Evansville’s real estate scene is the increasing likelihood of multiple offers on a listed property. This is every seller’s dream— but if you are one of the bidders, it’s important that you don’t allow it to become your nightmare.

There is one way— the only sure way—to keep the specter of competing multiple offers from upsetting your home buying prospects. Summed up in one word, it’s “preparation.”

Preparation starts with assembling a strong financial package. If your target property attracts multiple offers, you want yours to stand out. By the time you learn that other offers are at hand, it’s probably already too late to begin putting together documents—they should be in hand before you even identify a property. Getting pre-approval for your loan, having a letter that says so, and being able to show you have funds available can be persuasive.

When it comes to making the offer itself, although including “Subject to” clauses will protect you from unforeseen problems with the property, when multiple offers are on the table, the fewer contingencies the better. Again, only preparation will make this reasonable. If you’ve had an advance home inspection, and also made sure that there aren’t any right-of-way or easement issues, your offer can be significantly more attractive.

Personal preparation can be another positive. Visiting the property on several occasions at different times of the day should give you added confidence for what the home is truly worth to you…and when the listing agent and owner can put a face to your offer, it tends to strengthen its validity.

When multiple offers on a property occur, it’s possible that someone is going to bid more than the home is really worth. If you’ve done thorough research and know precisely what its value is in today’s market, that won’t be you. Having your bottom line number unshakably in mind means that in any bidding war, you’ll be able to sweeten your offer without hesitation. You can be creative, perhaps by offering to reduce the seller’s costs by picking up escrow fees, transfer fees or title policies; perhaps by offering the seller a few additional days to move without seeking financial compensation in return; perhaps by increasing the down payment or earnest money. When you know your bottom line, the arithmetic is uncomplicated (and your less-prepared competitors are more likely to throw up their hands!)

And then…should the bidding go over what you know it’s worth, you’ll be ready to walk away. There will be other properties to bid for – and I’m always here to help keep all your options open!   

Market Watch January 2014

Before we talk about 2014, I think this is an excellent time to compare the real estate market in 2013 to the previous year.  My ulterior motive is that from virtually any perspective 2013 was a great year!

Unit sales in our market increased just over 10% from 2012 to 2013, while the median price increased 2.2% over the same time frame.  While these increases did not improve quite as much as our statewide increases of 13.6% in units and 4.2% in median sales price this was still an excellent year.  If you remember Market Watch from a couple of months ago, I pointed out then that the decline in unit sales and median prices was not as great as the state as a whole so I did not expect the increase to be as strong either.  2013 was the best year we have ever had in sales volume.  This was the first time that F. C.  Tucker Emge Realtors closed over $400 million in sales volume.

In addition to the increase in both homes sold and in prices, there was even more good news.  Both days on market and the list price to sales price ratio also improved.   Homes are now selling, on average, about 100 days after they are listed, down from 122 days at the beginning of 2012.  The final list price to sale price ratio averaged just under 96% for all of 2013.  Both of these numbers are sustainable and are good indicators of a stable market.

One statistic that is outside the normal range is the number of homes currently for sale.  As of mid December there were 2,326 homes for sale in our MLS.  This is the lowest number of homes on the market since May of 2005.  The message here is that if you are considering selling your home, get it on the market now.  The spring selling season always starts sooner than most sellers think.  On average, buyers look for 10 weeks before buying a home.  Since it takes 30-45 days for a typical transaction to close, buyers who will actually move in April or May are looking for homes online today.  Don't miss the best time of year to get your home on the market, and keep in mind the most visited local website is FCTuckerEmge.com.

If you haven't already registered to receive email notifications of new listings in you geographic area or price range give me a call and I can help you register.  You can even help friends or family find what they are looking for. Give me a call if you have any questions about our market or specific questions about the value of your home. You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com

It can take years for first-time buyers to save up for their first home’s down payment, but even after that hurdle has been cleared, it can take even more time to secure a mortgage -- if they have neglected the other part of the equation. Their credit rating.

Before first-time buyers in Evansville will be able to move forward with that initial home purchase, they need to ensure that their credit score does not raise the kind of questions that sometimes derails an otherwise well-qualified home loan applicant. This has always been true, but may become even more likely as lending limitations grow increasingly strict.  

But it’s the occasional recording error or misstatement that is most easily preventable. Ironically, those often affect perfectly well-qualified buyers—precisely because they have no reason to suspect that a problem could crop up.

The upshot: first time buyers should start reviewing their credit history one year to six months before they intend to buy a home. Since the credit agencies provide upon request free copies of every individual’s report once each year, the only hassle is having to check the details line-by-line (a single reporting error can have a big impact on an overall score). And since it’s not unusual to take 90 days or more to cure a disputed entry, the earlier a first-time buyer begins the process, the better. Individuals can file a dispute online with the credit bureaus, or can hire a credit repair company to assist with disputes. In all cases, claims should be documented and correct information provided immediately.   

Once a first-time buyer is certain that his or her reports are accurate, is it time to relax? Hardly. It’s important to continue to monitor those scores to ensure against accidental surprises. Especially, after wholesale credit card thefts sowed confusion and disruption throughout the system, it’s probably wise to assume nothing. Several online services offer credit monitoring (and it’s possible that your bank might provide free monitoring).

From first-time buyers to seasoned investors, I’m here to help my clients every step of the way. Call me today! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com

For most of us, the appeal of new construction—a brand new home which your family is first to own—is undeniable. The idea of being able to select your own floor plan with a layout you like and upgrades built to order is hard to beat.

But home shoppers looking for new construction in Evansville should be particular. If their future home is to meet expectations, some sophisticated questions should be asked and answered before any agreements are reached.

Home models are usually decked out with the best and most expensive furnishings and finishes, unlike more modest packages, where the unadorned dwelling is delivered without any fancy stuff. When you are viewing a home in a new construction development, be sure to ask how much that specific model costs—as-is. You can bet that the figure will be substantially higher than the most widely-advertised low-end price…and when you question what features create the price differences, you’ll readily determine if those are features you consider indispensable. A little arithmetic, and you’ll know how much your home will run.

Some developers have better reputations than others, and you’ll want to work with the very best. Ask for references, of course, and do your own online investigation. Look at the previous new construction projects the developer has worked on and check whether they’ve had numerous complaints filed against them. Don’t necessarily trust every grumpy comment; but you can tell from the general level of satisfaction what you’re likely to experience.

New construction proceeds as a complex process—one where it pays to monitor progress to confirm that you’re getting exactly what you want (with no changes or alterations accidentally slipping through). Before signing on the dotted line, be sure you understand exactly what the construction process entails, and when and how often you’ll be able to enter the site to monitor progress.

Asking the right questions and monitoring finishing work is key in preventing unwanted surprises when it comes to new construction. If you’re interested in learning more about new homes and developments in our area, I’m just a phone call away! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com

The signs are positive for those who will be putting their home on the market this winter. Demand is there, mortgage rates are still low, and across the nation, prices are pointing higher. If you will be selling a home in Evansville anytime soon, there are some extra steps you can take to strengthen your position. 

Clarify Your Finances

Getting a home loan will be the concern of the buyer, not you. She or he will have to fill out the forms, go through the credit checks, etc. More subtle is the impact your own financial picture can have on the process of selling a home. If you will be moving to a new home yourself, it’s a good idea to get pre-qualified for that transaction even as you begin selling your home. When you are secure in the knowledge that you have qualified to buy your next home before your current property is sold, it solidifies your bargaining position. If not, you need to know that so you can time your sale’s closing appropriately. Knowledge is power—clarifying your finances will make for smoother sailing. 

Repair Early

Selling a home for the best price requires presenting it in its most favorable light. Even minor fixes that are clearly trivial should be tackled before the first prospect crosses the threshold, First impressions are hard to erase, and the psychological impact of even minor problems can influence the apparent value your property commands. Some experienced homeowners even pay for their own advance inspection before selling a home just to identify problem areas it takes an expert’s eye to uncover.

Find the Right Agent

Your choice of Realtor^® will have ongoing consequences, so taking the time and effort to find a compatible agent will be well worthwhile. Selling a home in Evansville is a many-faceted project, so find a partner you will enjoy working with— one who communicates openly and honestly about everything from today’s market profile to which service professionals are the most dependable.

Thinking of selling a home in Evansville this winter?  Call me for a complimentary consultation.  I’m always here to offer the best current marketing ideas! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com

If there is one question that homeowners and prospective shoppers have in common as we enter the New Year, it’s about the direction of local real estate values in 2014. Small wonder: the financial market meltdown of the last decade had such a profound impact on all forms of real estate that it still has many people looking nervously over their shoulders. How likely is another tumble in the coming 12 months? Will real estate values in Evansville continue to rise? Knowing the answer could make a big difference to anyone planning to buy or sell a home in the area this year.

Of course, absolute certainty on that score is not possible for anyone without a time machine in their basement. But, as we look back over last year, we might gain a little bit more confidence by hearing from the experts who got it right in 2013.

Foremost among them was Dr. Lawrence Yun, the chief economist of the National Association of Realtors^®. Last year, he was dead-on. 

Dr. Yun is calling for a continued rise in prices—pretty much in line with the past year’s gains. To compensate for expected mortgage interest rate gains—the likely effect of the Federal Reserve’s easing of policies that fueled 2013’s financial markets—he suspects that lending institutions will ease borrowing strictures. That’s something we can all applaud!

Overall, if local real estate values in 2014 follow the NAR’s national prognostications, we would expect real estate value increases either like the Wall Street Journal’s quoted prediction of 6%, or of Dr. Yun’s 5%. Either would not be surprising, given last year’s real estate values numbers. What the NAR experts and the Journal also agree upon is a flattening of residential housing sales volume in line with 2013 levels.

How much credence can we give to what the seers predict? Perhaps a little more than usual. “The NAR forecast could be viewed as restrained in light of the housing market’s gains in the past two years,” says the Journal; and “…other 2014 forecasts are fairly close to Mr. Yun’s predictions.”

Thinking of selling a home in Evansville this winter?  Call me for a complimentary consultation.  I’m always here to offer the best current marketing ideas! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com

You’re nearing your goal of buying a home in Evansville! You have zeroed in on a property, submitted your offer, and heeded your agent’s advice and ordered a home inspection.  

Soooo…what if the inspector finds major issues nobody expected? While most home inspections only uncover small problems that can be fixed easily, some do turn up serious issues. In 2013, 16% of Realtors^® reported sales that went off track due to the inspector’s findings. What’s your best course of action if that happens?

Buying a home after major problems have been identified should only proceed after you know how much time and money it will take to solve them. Whether you are dealing with foundation, roofing, electrical, HVAC or plumbing issues, call a few companies that specialize in dealing with structural home repairs, and gather some free quotes. Depending on what you hear, you can then decide to move to modifying your offer or you can walk away and look for another home.

Your agent will be able to assist you in modifying the original offer to the seller. If the issues are truly major and expensive, you may need to negotiate back and forth with the seller to see what they are willing to do. Be prepared to make some concessions, and don’t get frustrated with the process. It may take some time to come to an agreement that satisfies both parties.

As everywhere, buying a is peculiarly both a heavy-duty financial decision as well as one fraught with emotion. People can find themselves tempted to ignore thorny issues simply because they have fallen in love with the home. But since you could end up spending tens of thousands of dollars on repairs, it’s vital to isolate your emotions from the decision.

If the bids you’ve received are astronomical, it could be time to find a better house. But you needn’t despair. This is all part of the process of buying a home—and a big part of why I’m here to help my clients.  If you’re buying a home this winter, I’ll look for your call! You can reach me on my cell phone 812-499-9234 or email Rolando@RolandoTrentini.com