Current Real Estate Market News in Northern Virginia

To Refi or Not to Refi....that is the question.

2009-01-18T20:34:00.000-05:00

With interest rates for 30 year mortgages amounts lower than 5%, thousands of home owners are eager to lower their monthly household expenses by refinancing their mortgage.
Banks are overwhelmed to say the least with mortgage applications, about 80% of which are for refinancing. How should you go about making the decision to refinance or not? It can be a tough call. Here are some key points that might assist you in the decision.
· If you have a loan with a prepayment penalty which were popular in 2004 and 2005, refinancing can result in steep penalties. Be sure to check with your current lender or read through your mortgage documents to see if one of these prepayment clauses exists.
· Be familiar with the present value of your home. In Oakton, we have seen the majority of homes selling for close to the assessed value. Given the crunch that Fairfax County is in right now, those assessments have been dramatically reduced further reducing the most recent sales prices of homes in our neighborhood. If you need to refinance a mortgage that is more than 80% of your homes current value, you will have to wait until values increase. I would be more than happy to visit your home and provide a fair market value analysis of your home.
· Lending terms are much stricter than a few years ago. The lackadaisical manner in which Banks were lending in 2004 and 2005 drove the demand for housing as well as home prices to extreme levels. Those same lenders are now tightening their belts to avoid further defaults and foreclosures. What this means for you and me is that the requirements for financing have reverted back to pre 2000 standards and then some. Be ready to provide 2 years of tax returns, 2-3 months of bank statements and employment verification is back on.
· Will it payoff in the long run? Unless your current lender is offering one of the no cost refinancings on existing mortgages that are out there, there will be closing costs incurred. To save closing costs, ask your lender if they will consider renegotiating the terms of your existing mortgage without going through a formal application process. Refinancing requires the deed to be recorded again. There will also be settlement charges and lenders fees. Ask whatever lender you are dealing with for an estimate of these expenses. Also ask for the estimate of your new monthly payment (with insurance and taxes included – otherwise known as PITI). Subtract the new payment from your current payment and divide that amount into the total amount of expenses that are associated with the new loan. This will give you the exact number of months that it will take you to recover the expenses associated with the refinancing. For example: Let’s assume that the costs associated with the refinancing will be $5000. if your current monthly payment is $5,000 and your new monthly payment is $4,000, it will take you 5 months to recoup the costs.
· If you are in a position to refinance, start by contacting a lender. Grab a glass of wine and have a good movie ready so that your wait time on the telephone will not seem to be such a waste of your time. The banks are understaffed and are bombarded by heavy call volumes as a result of the low interest rates.
The bottom line is that mortgage rates are at a historical low and like most of us, I do not have a crystal ball to determine when they will be this low again. It is an opportunity to reduce your monthly household expenses for the long run. For questions about this article, please contact me at 703-856-5405 or krisbsellshomes@aol.com.

New Fed Efforts to Jump Start Lending

2008-11-27T18:00:00.002-05:00

On Tuesday November 25, 2008, the Federal Reserve and Treasury Department committed up to $800 billion to unfreeze credit for homebuyers, consumers and small businesses. The newest programs are designed to jump start lending by the nation's banks and put money in the hands of consumers. Immediate results were seen, as rates on 30-year mortgages dropped a record 1-1/8 percentage points on Tuesday.

As part of the plan, the Federal Reserve will purchase up to $500 billion of mortgage-backed securities backed by Fannie Mae, Freddie Mac and Ginnie Mae, as well as up to $100 billion in direct debt issued by the three government-sponsored mortgage finance firms. This action is being taken "to reduce the cost and increase the availability of credit for the purchase of houses, which in turn should support housing markets and foster improved conditions in financial markets," according to a Federal Reserve statement.
Additionally, the Federal Reserve Bank of New York will loan $200 billion to holders of securities backed by consumer debt, such as credit card debt. This should make consumer credit more affordable and allow consumers to spend more freely, thus strenghthening the overall economy.

These new initiatives are aimed directly toward improving the real estate market and overall economy, and freeing up more mortgage money for home purchases.

This reinforces my thoughts on the current market. Now is a terrific time and golden opportunity to buy a home. Take advantage the the week's current interest rates which have fallen below 5.5%.

2008-11-21T19:50:00.005-05:00

Weekly Market Update from the desk of

Steve Arsenault...............

This publication has a tendency to be written with technical jargon; however, this week's edition should be easier to read. It addresses the new loan modification program for 'at risk' homeowners going into effect December 15, 2008. This program is intended to help homeowners who are more than 3 months behind on their mortgages owned by either Freddie Mac or Fannie Mae.

If a homeowner has less than 10% equity in their home, they may be eligible for a note modification. These modifications are intended to reduce mortgage payments to 38% of the owners gross monthly income. There are 3 ways the mortgage payments are going to be lowered:

(1) Increase loan term to 40 years
(2) Reducing the interest rate
(3) Deferring a portion of the principal repayment

This program is intended to help hundreds of thousands of homeowners in jeopardy of going to foreclosure.

Rates continue to remain low. Below are rates available for the weekend:

30 Year Fixed Rate (<$417K) - 5.875% with 1 point
30 Year Fixed Rate (>$417K) - 6.125% with 1 point
FHA/VA - 30 Year Fixed Rate - 6% with 1 point

Please feel free to contact me in regard to the post above or any other information that I might be able to provide.

Steve Arsenault
sarsenault@weichertfinancial.com

You can buy a house with less than 20% Down

2008-11-17T12:36:00.002-05:00

One of the common reasons that homebuyers remain on the sidelines is that they think they need to have a 20 percent downpayment in order to get a mortgage. This is not always the case and you might be pleasantly surprised at your options.

Recent statistics from the National Association of Realtors show that the number of first-time buyers is increasing. It is common knowledge that most first-time buyers don't have large downpayments, so they couldn't possibly all be putting 20 percent down.

Low-downpayment loans are still readily available. Weichert Financial is solid and strong and has recently made mortgage loans with as little as 3% down.

It remains a great time to buy and good loans with low downpayments are still available, despite what you might have heard. Remember, Weichert has the financing to provide a mortgage for the homes we sell. For more information, please contact Steve Arsenault at 703-359-6592 or sarsenault@weichertfinancial.com.

The Holidays can be a great time to show your home.

2008-11-14T16:52:00.002-05:00

Family, cheer, warmth- these are some of the memories and feelings the holidays conjure up and they are, not coincidentally, the best possible feelings to create when showing your home. Holidays offer the seller so many options for making a home perfect for the buyer: Special lights, holiday smells, cozy fireplaces, and festive decorations. Remember, though, the motto for sellers is 'stay simple.'

Use modest lighting and decorations inside and out.
If you have a Christmas tree, consider buying one size smaller than you usually buy. Arrange a few simple gifts with matching wrapping paper under the tree. Make sure there is no extravagant display of gifts or toys under the tree. Store furniture that is displaced by the tree.
For all decorations, smaller and simpler is better.
Favor natural materials such as real pine branches and pine cones for wreaths and other decorations, and shun plastics or bright, big decorations. Avoid blowup decorations outside.
Decorate your home with fragrance. Bake bread or cookies. If this is impossible, try light holiday fragrances such as vanilla or cinnamon. Avoid heavy pine smells.
Clean thoroughly your fireplace and make sure a small, crackling fire is going during walk-throughs. Pay special attention to the temperature of your home. Make sure the home is lightly warm, not so toasty that potential buyers can't stand to wear their coats.
Make sure all your window blinds and curtains are open for day showings. This means the windows themselves must be perfectly clean. Buyers are comforted in knowing that a home has been maintained well.

If you have any questions on preaparing your home during the holidays, please feel free to give me a call at 703-856-5405 or send an email to kris@krisbsellshomes.com.

It might be a good time to revisit your personal credit.

2008-11-14T16:47:00.002-05:00

If you're planning on buying a home in this great housing market, you'd better start checking your credit reports now. There may be some surprises waiting for you. Given the credit crisis, some credit-card companies are reducing credit limits on some borrowers. For some people, that may drag down their credit score even if they have been diligent about their finances. Here's why: A major factor in calculating a person's credit score is credit utilization (how much of your available credit you use) according to Fair Isaac (as in credit-quality FICO scores). When your total available credit shrinks, the percentage of credit that is being used goes up, and that can do some damage to your credit score regardless of how well you've kept up on payments.
If you plan on buying a new home in the next year, there are five things you can do to keep your credit looking as good as possible, according to Fair Issac’s:

Check your credit report: Find out if there have been changes to your account limits, and make sure there aren't any errors. Look for any negatives on your report (most negative items should be removed after 7 to 10 years).
Keep the balances low: About 30% of your score is based on a ratio of the amount that is owed on active cards to your available credit. Utilization on individual cards is key; getting close to the limit on one card will reflect negatively on your score. Pay down balances as much as possible.
Keep accounts active: Accounts get closed when there is no activity on them for a while. Make small purchases on cards a couple of times a year, then pay them off right away, to keep accounts active and your available credit up.
Pay your bills on time: This should an easy one, but could prove challenging if you run into hardship. Contact the credit-card company as soon as possible if you're having problems paying your bill. Payment history counts for about 35% of your credit score.
Avoid new cards: Store cards are tempting when they offer discounts at the register, but don't bite. Applying for that card will have a negative effect on your score short term.

If you have questions about your credit score, Steve Arsenault at Weichert Financial Services can help. With the new “Credit Assure” Model, he can potentially help you improve your credit and perhaps qualify you for a program or better rate that you may not otherwise have been eligible for. Ask us how! We are here to help!

Weichert Financial Services-Weekend Update

2008-11-14T16:43:00.003-05:00

From the desk of Steve Arsenault...

Rates have remained relatively stead this past week, given the high volatility within both the equity, mortgage and general credit markets. The government control of the GSEs (Freddie Mac and Fannie Mae) has resulted in a return to 'responsible' lending. Freddie Mac is leading the way by prohibiting the sale of any Freddie Mac mortgage with debt-to-income ratios in excess of 45% slated for deliver in 2009. Fannie Mae is expected to follow-suite shortly. Restrictions are also now being imposed on Government loan programs, such as FHA and VA. Maximum debt-to-income ratios are being restricted to 50% going forward. Despite the obvious restrictions on certain higher-risk borrowers, these actions should increase the likelihood of future repayment for new GSE loans. This may also increase confidence in investment in the credit markets for mortgage loans, possibly resulting in a new infusion of investment in the Mortgage Backed Securities (MBS) markets.

Also, new loan limits have been established for 2009. The Conventional Conforming loan amount will remain at $417K. The new high cost Conventional Jumbo loan limit has been set at $625K (previously $729,750). The maximum FHA loan limit will also be $625K.

Below are rates available over the weekend:

30 Year Fixed Rate (<$417K): 5.875% with 1 point
30 Year Fixed Rate (<$625K): 6% with 1 point
FHA/VA: 6% with 1 point

If you have any questions or would like more information, please feel free to contact me at:(703) 359-6592.

Weekly Mortgage Monitor

2008-11-07T16:08:00.002-05:00

From the desk of Steve Arsenault....

The week has seen large reductions in mortgage rates. The reduction in mortgage rates is directly related to large numbers of domestic and foreign buyers purchasing massive amounts of MBS (Mortgage Backed Securities). The government is continuing to reiterate the "explicit" guarantee that the federal government has made with respect to backing MBS's originated through Freddie Mac and Fannie Mae.

Other good news this week is the release of the new 'conforming' loan limits. The new limit for 'non-jumbo' conforming loans is still $417K. The new 'jumbo conforming' loan limit has been reduced to $625,500, to begin in 2009.

Below are rates available from Weichert Financial Services for the weekend:

30 Year Fixed Rate (<417K) - 5.875 with 1 point
30 Year Fixed Rate (>417K <729K) - 6% with 1 point
FHA/VA 30 Year Fixed Rate - 6% with 1 point

Please contact Steve Arsenault for more information at: 703-938-6070.

A Guide to the Northern Virginia Real Estate Market for the new Obama Administration

2008-11-06T20:58:00.005-05:00

Welcome to DC!

If you’re coming to Washington, D.C. to join President Obama’s team, you’re probably wondering where you should begin looking for the perfect place to live. House hunting in a new town can be difficult if you don’t have an experienced source of up-to-date advice. As a long-time resident, it is my pleasure to introduce you to Northern Virginia.

Just across the bridge from Washington, DC, Northern Virginia offers easy access to the city by the Metro System and major roadways. No matter what your lifestyle and housing requirements, there is something perfect for you in one of Northern Virginia’s many communities. Living here will give you a short commute to work with the added benefit of a short drive to the beach or the mountains.

Becoming part of the new administration is probably the most exciting and busiest time in your life. With this in mind, I can assist with your relocation to the area so that you can focus on meeting the demands of your new position.In addition to the ordinary factors associated with relocating to any new area, the DC Metro area presents a number of additional challenges to think about:

Washington DC Traffic - One of the first questions I get from most of my clients who are relocating to the area is: How bad is the traffic…really? You need to decide how long a commute you are comfortable with—I’ll take it from there, researching compatible areas for you.
Schools - Based on the area(s) you think you want to live, check out the local school districts or private schools. With this information, I can narrow the search even further.
Community Atmosphere - Growing up in Northern Virginia gives me the expertise and knowledge of most communities and their amenities. I’ll answer all your questions about the features of an area and point you in the right direction to accommodate your lifestyle.

Your free time can be as full of activity or as laid back and relaxing as you choose. There’s always something to do here. I can't wait to show you around!

Weichert offers all services required in your Real Estate Transaction..

2008-11-05T22:02:00.005-05:00

Can life get any more hectic these days for most of us? If I could only have about 5 additional hours of daylight to transact business, attend soccer games, and tend to all of the other issues that I face on a daily basis..life might be a bit more relaxing. Although I am not expecting the extra hours to suddenly appear, I do appreciate that working with Weichert allows me to offer a less hectic Real Estate transaction to my clients with a turn key solution through Weichert Gold Services.

As a Gold Services Manager, Steve Arsenault, is able to assist my clients with everything from obtaining a Mortgage and an Insurance policy right down to changing the utilities over in their new home. Working closely with Steve provides the benefit of a smooth transaction and minimizes the chances of any surprises that can arise in the Real Estate business. Steve has been fundamental in most of my successful settlements. He enables me to focus on my top priority, my clients and their specific requirements. More importantly, he is able to minimize my client's time by reducing their effort spent on completing the transaction allowing them the valuable time that they need to plan for a major move.

To learn more about the Weichert Gold Services available please visit our website at http://www.weichertgoldservices.com/ or feel free to give me a call.

Election Day Results in the Real Estate Market

2008-11-04T09:57:00.003-05:00

As we all sit patiently yet anxiously and wait for the results of the election this evening, we cannot help but wander how this is all going to effect the local real estate market. If you are selling your home and are located inside the beltway, you will notice a slight increase of sales in your area immediately following the election results. For sellers who are located on the outskirts of the DC metro area, I am sorry to say that there will be little to no change as a direct result of the election.

Sales figures have risen in all parts of our areas due to the decline in prices over the past 12 months. Prices in our are have fallen 20-25% depending on what area you are in. We expect to see the amount of transactions increase through the last quarter of 2008 as prices adjust out at pre-bubble levels.

If you would like a complimentary price analysis on your home, please feel free to give me a call at (703) 856-5405.

Here is a listing on one of the most sought after houses in the country. Enjoy.

http://www.zingding.com/h/7476090146

What Buyers Are Looking For in our Current Market

2008-11-02T22:09:00.001-05:00

When I started my first Company as an Accountant years ago, a good friend of mine asked me, “What will you offer that will be superior to anyone else for customers to choose your Company?” This question has followed me throughout my years in accounting and is present today in my real estate career. Not only do I stress to customers what I bring to the table that is superior above other agents but equally as important is what a seller’s home will offer a potential buyer that will make it superior over others in the area.

We have all been bombarded by mailings and articles showing many statistics for recent real estate activity on National as well as Local levels. These statistics are not always that significant or helpful to a potential seller. The sellers that I work with want to know what it will take to get their home sold in the shortest amount of time and for the best price possible. The answers are the same with every listing that I approach. Your home must be immaculate. We are not in a neighborhood with foreclosure signs lining the streets that attract buyers who are seeking a bargain basement price knowing that the house will be cosmetically challenged as well as possible having major problems. We are in a neighborhood where people want to move-in and resume their lives in a freshly painted and updated home.

You can no longer look at the cost of getting your home ready for the market and wandering if you will recoup your costs. Rather, the issue is that by not properly preparing your home for the market, your home has the potential of sitting on the market while other homes in the neighborhood sell.

An astounding 95% of the buyers that I work with will turn their noses up immediately when walking into a home with outdated wallpaper and appliances. The comments range from “This reminds me of my grandmother’s house” to “This house needs way too much work”. The fact is that most times, it does not take “way too much work” to make your home attractive to a buyer. Let’s face it, our homes are nearing the thirty-something crowd and lack the luster of the new homes that are being built today. I have been in numerous homes in our neighborhood that have been completely transformed and show beautifully. After redecorating several homes, it always seems to amaze me what simplicities such as a coat of paint, new carpeting, updated light fixtures, new door hardware and de-cluttering can do for the appearance of a home. On the outside, small fixes such as a fresh mulch cover, edged out flower beds and a small bag of grass seed can do wonders.

With the building and contractor industry in its current state, there are multiple qualified contractors that will be glad to help you transform your home. I am available for a preview at any time for a non-biased opinion of changes that will make a difference. Next month, I will cover my role as an agent and my proven advertising and marketing plan that will both attract buyers and bring offers on your home.