Keep Your Home California program expands…

In 2010, the federal government named California as among the top 18 states hardest hit by the market downturn. In an effort to curtail Californians losing their homes, the government created what is now the Keep Your Home California program, which was developed in collaboration with numerous community partners, foreclosure counselors, housing advocates and others directly involved in helping struggling homeowners.

Recently, Keep Your Home California has expanded its eligibility to different types of distressed homeowners. It has officially expanded its service to include aid to homeowners who raised cash through refinancing, who have second homes and who have been unemployed longer than six months. They have also extended the limit from six months to nine months for financial aid to those with mortgages of up to $3,000. For homeowners who received cash for refinancing their homes, they are now eligible for a reduction in their loans by $50,000 in order to help make their monthly payments more affordable with the Principal Reduction Program. Also available is a $5,000 stipend to help those relocating after opting for a deed in lieu or short sale through the Transition Assistance Program.

$2 billion strong, this program has already helped nearly 8,000 homeowners and Keep Your Home California is looking to make that number even larger. According to The Press-Enterprise,  “almost 50 mortgage servicers now participate and together they represent more than 85 percent of mortgages in the state” (see article). Business Wire quotes “This expanded eligibility will allow more families to qualify and receive greater assistance,” said Claudia Cappio, Executive Director of the California Housing Finance Agency. “We are continuously evaluating our experience so far and making adjustments like these based on the initial results of the Keep Your Home California program” (see article).

Since the program’s inception, it has been steadily increasing its aid potential with greater funds and an extended reach. In order for homeowners to be eligible, their lenders must be participating in the program so that along with more funds, Keep Your Home California is seeking to expand its lender participation.This program is not just about handing out cash, however, as it offers counseling, financial events and other resources to help educate distressed homeowners about their options.

Should you have any questions about this program, look here:

888.954.KEEP(5337) between 7 a.m. and 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays, or visit their site here.

Holiday House-Selling: Tips to Listing Your Home in Winter

So Winter is sometimes considered not the ideal time to list your home, but there’s still much opportunity for attracting buyers out there. Here are some tips to turning a holiday listing into a successful sale:

1) Keep your home in tip-top shape.

Now this advice for any time of year, but with the harsh Winter conditions it’s even more critical that you pay attention to the greenery, lawn, gutters, and any other portion of your home that is exposed to inclimate weather. Make sure to rake the leaves and keep driveways clear of any falling tree debris. Should it snow, take extra care to shovel the pathways so that buyers can tour your house safely.

2) Tone it down with the holiday decorations.

This is not to say that you should forgo any of the fun of holiday decorations, but think about white lights instead of color. Consider keeping the plastic reindeer in the shed this year. On the interior, keep the nutcrackers, mistletoe and granny’s life-size elf doll to a minimum. Anything that makes the home seem too themed can distract from the buyer’s vision of themselves in the home.

3) Think cozy.

Staging a home in winter should appeal to those parts of colder weather that make home the place to be. According to Loren Keim, a  professor of real estate at Lehigh University. “If you have a vacant house in winter with the heat turned down to 50, chances are someone will make a very low offer,” he says. “And if you can leave at least a few pieces of furniture behind, it has more of an impact.” Make the home a refuge from the outside and an inviting space that will make the buyer want to stay and enjoy a hot chocolate.

4) Keep it light.

Natural light is a selling point for any house; unfortunately there’s not a lot of it come Wintertime. To offset the gloomier weather, opt for extra lamps and ensure when buyers come through that all lights are on and window shades open. Also keep a few lights on when you’re not there; potential buyers are driving around all the time and a dark, empty house is far less appealing than a glowing one.

Should you keep these tips in mind, listing during the Winter season doesn’t need to be unseasonable. In fact, there’s nothing like cold weather to make people want to stay at home; make sure you do everything you can to make sure that it’s yours they decide to stay in!

You’ll feel like a movie star in this home theater!

Price Reduced! The home theater in this gorgeous custom home is just one of its many special features. This 4 bedroom, 3.5 bathroom home was completely rebuilt in 2005. Boasting traditional styling coupled with contemporary amenities and high tech features, this home was meticulously and thoughtfully designed by the current owners. With generously sized rooms and living areas, the 3825 +/- sq. ft. residence sits on an expansive 19291+/- sq. ft. lot featuring a private, oasis style backyard with pool and built-in BBQ. Close to Historic Downtown Pleasanton, this home is located in the desirable Vintage Hills neighborhood, with proximity to top rated schools, 580 and 680 Freeways and approximately 30 Minutes to Oakland International Airport.

Now offered at 1,400,000

1320 Bordeaux Street, Pleasanton 94566

Shown by appointment only.

See virtual tour.

Own vs. Rent: A Rebuttal

In an editorial responding to a question from a CNN Money reader that asked…

NEW YORK (CNNMoney) — For the last three years, my husband and I have been renting a house. But I would rather buy than throw my money away on rent. Still, even though we have about $120,000 in savings, great credit and no debt, my husband is reluctant. The job he’s had the past two years took 15 months to find, and it pays a lot less than his previous job. He’s afraid buying now isn’t a good idea because of the shaky economy. What do you think: Should we buy or continue renting? — Jean J.

Contributing writer, Walter Updegrave, responded…

First things first, I want to dispel the belief that you are throwing money away on rent.

This is a self-serving notion real estate agents often spout that not only isn’t true, but isn’t a basis for making a rational decision when it comes to buying versus renting.

Fact is, when you rent, you are buying. You’re buying a service: the use of a house for a specified period of time. And as long as the rent you’re paying is in line with what others are paying for comparable digs, then you’re getting that service at the market rate.

Granted, you don’t have some of the potential plusses of ownership, such as seeing the value of your home climb over the years. But renting has other advantages. You can move more easily, and you’re not on the hook for real estate taxes and upkeep. And the money that would have gone into your house can be spent on other things or go into other assets.

___________________________________________________________________________

Here, Mr. Updegrave claims that the idea of home ownership is an agenda pushed by “self-serving real estate agents.” However, this is an extreme distortion of the facts. If Mr. Updegrave has an issue with the notion of “throwing money away on rent,” he goes on to admit that in fact you don’t have the advantages you would have should you have used your cash to purchase a home. So, in fact, the issue is not perhaps an either/or proposition, but rather a question of where your resources are best allocated.

Any professional Realtor will tell you that not everyone is in an optimal position to buy, but should one be in such a position, buying a home continues to be a solid investment, despite all the nay-saying and barrage of dismal news the media projects at us daily. One of the core institutions in our country is the ideal of home ownership; rough economies and uncertain times have done little to alter the foundation of this institution in reality, despite the doomsday rhetoric.

And if you’re looking for more proof, take it from some of our country’s top economic advisers; for instance, Warren Buffett says that his home was the third best investment he ever made (see article). The powerful lobby, NAR, says that: “The vast majority of both home owners and renters say that owning a home is a smart decision over the long term. Even in today’s challenging economy, 95% of owners and 72% of renters believe that over a period of several years, it makes more sense to own a home” (see article). In addition, Inman news points to “the results of a biannual survey, released this week by real estate search and marketing portal Trulia, [that] found that 80 percent of homeowners plan to buy another home, and that most survey participants view homeownership, and placing money in a 401(k) or other retirement account, as the best long-term investments” (see article). This data speaks also to the fact that with the current market trends, rents are skyrocketing while the cost of purchasing a home is still in decline.

Underlying the arguments for home ownership is also a quality of life issue. Buffett says that: “For the $31,500 I paid for our house, my family and I gained 52 years of terrific memories with more to come” (see article). As well, “An overwhelming majority of home owners are happy with their decision to own a home. A full 93% of owners surveyed would buy again” (see article). In the end, then, we have not only the support of financial data to show us that buying a home, when done correctly, is a solid investing decision but also the question of affect, as we are so often reminded; indeed home is where the heart is, there’s no place like home.

After the past few years, buying or renting can quickly turn into a fear-based decision; the news tells us constantly about crumbling markets, downturns and double dips. But when it comes to what is for most people the largest financial investments of their lives, it’s best to delve deeper, past the rhetoric, and look at the facts. The facts are that buying a home today is a far more accessible and sensible option than it has been in decades, what with inventories, prices and available interest rates, and that such a financial environment is the perfect opportunity to make a prudent investment in both your financial future as well as your emotional one.

To find out whether you should be buying or renting, check out this interactive chart.

Join me on a tour of a luxury San Ramon home!

This newly listed bank-owned home is luxury all the way with unbelievable finishes. I will be showing this home on Tuesday, November 8 from 12pm to 3pm, so call me to schedule your viewing as appointments are limited.

A New Kind of Closing Gift – A U.S. Visa

Living in an area with so much investment property as it is, there may be more to come should this measure pass. MSNBC reports that two Senators have come up with a plan to boost the moribund U.S. housing market: Give residence visas to foreigners who spend at least $500,000 to buy a home in the U.S.

Undoubtedly there will be much debate, but it’s better than a gift basket and could very well help out property sales in areas already investor-friendly, like the Tri-Valley.

Bemoaning Loans: The Misperception of Adjustable Rate Mortgages

There are a few words that continue to strike fear into the hearts of homeowners and buyers since the beginning of the trouble in the housing market: sub-prime, no-interest loan, negative amortization and on and on. One concept that continues to get a bad wrap is the adjustable-rate mortgage, or ARM. An ARM is a loan for which the interest rate on the note is periodically adjusted according to the cost for the lender of borrowing the money on the credit markets. As America reflects on the heyday of questionable lending, many are wont to blame the ARM for much of the crisis, citing it’s riskiness and instability; these same people consistently call for a return to more fixed-rate mortgages believing that these are inherently safer.

As time has passed, however, new numbers are showing us that it was not, in fact, ARMs that were one of the leading causes of the housing downturn. In a Senate banking committee meeting on Thursday, Paul Willen, Senior Economist and Policy Advisor at the Federal Reserve Bank in Boston, noted that “60% of the loans that foreclosed due to delinquency were fixed-rate mortgages. But even more importantly, of those other 40% of loans that were adjustable-rate mortgages, 88% — the vast, vast majority — defaulted when payments due were <strong>at or below</strong> the borrower’s initial payment amount. A little math shows that adjustable-rate payment shock was responsible for less than 5% of mortgages that were foreclosed due to delinquency” (The Atlantic, October 26, 2011).

Willen states without reservation that so-called “payment shocks” from the adjusting of ARM rates did not cause the crisis since rates did not only go up, but also down. What Willen cites as the primary cause of the turbulence are “life events” – job loss, illness, divorce – concurrent with falling house prices; this, he says, resulted in loss of equity in homes.

Now that ARMs are being redeemed, the general public may start to think about them differently, especially considering the phenomenal interest rates they offer. Rather than a wild beast that carries a borrower along on an uphill ride to higher payments, current ARMs have very reasonable rate caps; for instance, a 5/1 ARM can be around 3.5% as a base rate, and many can only expose the borrower to a jump in rates equal to .5% per year after the initial five years with a cap anywhere from 5% to 7%. From the days of 14% interest rates, this still ensures a borrower a great deal.

So while ARMs are working on rehabilitating their image, many in the homebuying American public could benefit greatly from them, particularly those purchasing condos or in urban areas for whom the average lifespan of a loan is around five years. While we should all learn from the lessons of the past few years and it’s respectable that those pointing fingers at ARMs are looking to be a bit more wary when it comes to borrowing, it’s best to get educated about what and whom is truly responsible for all the trouble, lest we miss out on a great opportunity.