Black-owned homes are regularly low-balled in appraisals.
It’s been happening for generations. Now, the Biden administration is confronting
On June 1, 2021, the president said a new task force will deal
with race-associated disparities in home appraisals. Housing and Urban
Development (HUD) Secretary Marcia Fudge will lead the team as it embarks on a
thorough review of current appraisal methods and outcomes, and as potential
remedies are considered.
The task force will consist of a large group of agencies and
financial groups, encompassing the Federal Reserve, Freddie Mac and Fannie Mae,
the Consumer Financial Protection Bureau, and a host of financial groups. It
will seek information and guidance, too, from civil rights nonprofits as well
as the appraisal industry and its state-based regulators.
Continue reading “The Biden Administration Confronts Racial Bias in Appraisals”
You start off the marketing and sale of your home with a
listing agreement. This document controls all the terms of the sale. It sets
the keynote for a string of important decisions and legal agreements.
In this article, we’ll discuss some recent news about
listing agreements, as well as the broad-brush concepts every seller must know.
First, we look at some sales tactics to look out for before you even think of
selling. Then, we’ll explore how to understand the terms of the agreement
you’ll sign when you’re ready.
Continue reading “Selling Your Home? A Few Things to Know About Listing Agreements”
If a company says it’s selling land on the moon, should we
believe it? What about the planets? Is Martian land for sale? Is Venus
available? Here’s the story so far.
Continue reading “Extraterrestrial Real Estate: Is a Lunar Deed Legit?”
Floating homes are hallmarks of many coastal and riverside
cities. There are also amphibious houses — built on land, but capable of rising
up off the ground when storm waters rush in. Flexible utility pipes move to
meet the water as its ebbs and flows.
Putting homes over water serves to expand the available real
estate and can help keep prices down. The waterside lifestyle also appeals to
those who’d like to get away from the city hustle and live where they play. Not
surprisingly, interest in this type of construction is growing. We might even
say it’s buoyant!
Continue reading “Buying a Floating Home? Here’s How to Plan Your Purchase.”
Can Deed Restrictions Include Rather Than
U.S. home prices have outpaced U.S. employees’ wages. This creates
a number of problems in real estate. For one, it shuts a lot of people out of
the market. Most of today’s renters simply have no choice but to keep on renting.
And whether they rent or own, many employees find themselves in long-distance commutes,
because they cannot afford to live anywhere near their workplaces.
Landlords are increasing rents sharply these days. Consider Phoenix. Rents in all Phoenix suburbs have risen “by the double-digit percentages since the pandemic,” Zumper reports. Meanwhile, many residential areas throughout the United States have single-family-only zoning. Building affordable, multi-unit homes on a property is not allowed in those areas.
Every day, stock market commentators say we dodged the
financial bullet when we powered through the pandemic by Zoom, Teams, and
DocuSign. Yet many still struggle to afford homes. How can the affordability problem
Continue reading “Solving the Affordability Problem”
You’ve put in your bid for the home you want. Now you await
the appraiser’s report. What’s going on behind the scenes?
How the Appraisal Works in Most Cases
The typical home appraisal relies mainly on local sales
comparisons, or comps. What will other buyers pay now for a house like
the one you’re buying? Whatever price others will pay for similar homes is
roughly the value of your new home.
What’s a similar home? The appraiser considers homes within
a certain radius of the one you’re buying, with comparable bedroom and bathroom
counts, the same or similar size and construction type. Comparable homes have
the same school district or a similarly ranked school district, and similar
amenities nearby. The appraiser studies and compares sales information and
recorded documents for the homes. Homes sold in the last three months are
considered the most relevant comparisons.
Even similar properties are unique homes, of course. Therefore,
the appraiser will find enough variety in the data to come up with a range of reasonable
valuations. Some comparable properties might have been sold for more than the
market value, others at below-normal prices, and so forth. Once the outliers
are understood for what they are, an appraiser needs to figure out where your
desired house fits among slightly more and slightly less costly properties.
The expert’s professional discretion explains why, many
times, the appraisal will come back with a valuation very close to the price
you offered and the seller has accepted. As long as your agreed-upon purchase
price falls within the data-supported range of value calculated by the
appraiser, a buyer usually gets an appraisal that matches what the buyer and
seller think the home is worth.
Continue reading “Navigating the Home Appraisal: A Buyer’s Guide”
Is the hot
seller’s market of Summer 2021 tempting you to put your home on the
market and watch the offers roll in? To get ready quickly, you might wonder if
you should put a clause in your contract to announce you’re selling the house as-is.
A seller may use the term as-is to point out that the
house isn’t in pristine condition. The unspoken message? The home is available
at a discount to those who’ll upgrade it themselves. In other words, as-is
hints to buyers: Please don’t come back after the inspection to request
repairs, replacements, and price concessions!
But you can always speak with your agent about contractual
language that limits the buyer’s leverage in an inspection contingency. Selling
the home as-is adds vagueness to the transaction, and might not be your
Let’s flesh this out with some general considerations for
Continue reading “Selling Your Home As-Is? Here’s What You Should Know”
What’s the plan when your spouse or co-borrower needs to
come off the mortgage? Will you refinance, keep a modified version of the loan,
or sell the home to pay the loan off?
Here’s a quick Q&A to explore the possibilities.
Continue reading “How to Take Someone Off the Mortgage”
Hindsight is 20-20 vision. Homeowners learn something from
each home they buy. Looking back, most homeowners can tell you what they did
well — and a few things they could have done better. So, what can’t-miss items
need your attention before you buy?
We’ve said it before. There’s no overstating the power of a
great real estate agent and a diligent mortgage specialist. Their combined
know-how can guide you through every step.
Still, you’ll want to keep your own eyes open. Without
further ado, here are 6 questions to ask yourself when preparing to buy a home.
Continue reading “Own Without Remorse: Six Questions to Ask Yourself Before Buying a Home”
When it’s time to meet with their mortgage experts and apply
for loans, most home shoppers accept mortgages with fixed interest rates. When
they do, the interest rates are locked in throughout the life of their loans. That’s
a good thing, of course, if interest rates are low when the buyers get their
Adjustable-rate mortgages (ARMs) can seem complex and
unpredictable by comparison. At its outset, the common “hybrid” adjustable-rate
mortgage starts with a low, fixed teaser rate that the borrower keeps for a
certain period — normally three, five, seven, or ten years. Then, it becomes
After the initial, fixed-rate period, the payment is
recalibrated based on the current interest rates and following the terms set
out in the mortgage. Often this is done annually. An ARM could be written as
5/1, for example, meaning the borrower enjoys a low, fixed rate for a five-year
period, and after that, mortgage payments will be adjusted every year. So, a borrower
who goes to the adjustable rate has to make higher or lower monthly payments as
interest rates fluctuate.
An adjustable-rate mortgage typically puts a limit (cap) on
the homeowner’s payment increases. Nevertheless, there’s an element of risk in
a variable rate. It’s possible that the borrower will have to make much larger
monthly payments in later years.
Let’s turn to why some home buyers choose adjustable-rate
loans despite this risk.
Continue reading “Should You Get an Adjustable-Rate Mortgage? Here Are 6 Reasons You Might”