Monday, January 31, 2011
Trip to the Pumpkin Patch
City of Sacramento Rental Housing Inspections - THEY MEAN BUSINESS!!
I wrote a post about the City of Sacramento's Rental Housing Inspection Ordinance back in February of this year. Since then, I had only heard a few random comments about these inspections from some other agents who own rental property within the city limits.
Well...last week, my husband (an electrical contractor in Sacramento), got a very panicked telephone call from a woman who owns a rental duplex in Land Park. She explained that a city inspector had visited her property, and had determined that the main electrical panel was not up to par, there were no GFCI receptacles, there were not enough smoke detectors, there were not enough circuits to accommodate everything, and there were ungrounded 3-pronged receptacles throughout...there were also other non-electrical items. The inspector issued a correction notice, and these repairs had to be completed by a certain date, or she faced a stiff fine. YIKES!
So, my husband spent a week doing the corrective work...the bill for just the electrical was about $5,000 including all labor, materials, permits, and coordination with SMUD and the City of Sacramento.
Landlords within the Sacramento city limits - THIS ORDINANCE IS VERY REAL!
Short Sales Sellers - proceed with caution before you list your home with a Realtor who is a family member...
Well for the last couple months or so, I had been negotiating a short sale with this type of arrangement for another Lyon agent. This agent listed his son's property. Fine...seemed like no big deal - just any old short sale.
The loss mitigation rep from the lender contacted me yesterday. "Erin, I have some good news, and I have some bad news. The good news is that the short sale has been approved! The bad news is because the listing agent and the seller are related, we are reducing the listing agent's commission to $0." WHAT!?
The loss mitigation rep explained that it is their policy that ALL short sale transactions must be at "Arm's Length."
Well no kidding! I have dealt with Arm's Length transactions before and have blogged about them...in fact most lenders will require buyer and seller to sign an affidavit swearing that they are not related, and not business associates. The agents are not principles to the transaction...
I got my managing broker involved...basically Lyon Real Estate must still facilitate the transaction, but receive zero compensation, but accept all of the liability for the legal ramifications of the transaction. My managing broker suggested we switch listing agents...so we tried to convince the short sale lender to accept a substitute listing agreement, naming me as the sole listing agent rather than the seller's father. The short sale lender said no and they would cancel the approval if another listing agreement was presented.
So.....corporate legal counsel is now getting involved, and without going into more detail - the transaction is moving forward with no compensation to the listing side. Coincidentally, the buyer's agent commission was actually not reduced at all. The listing agent and his son (the seller) are just happy this short sale transaction was approved, and have assured me that my efforts will be compensated in some way...frankly, they are fortunate that Lyon Real Estate is still willing to facilitate the transaction.
So.....just be aware that this may happen if you list your short sale with a family member who is a Realtor. It looks like this transaction will have a happy ending, but I can see where this situation may cause problems for others.
Governor Schwarzenegger Approves Legislation to Protect California Home Buyers & Sellers


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Governor Schwarzenegger Approves Legislation to Protect California Home Buyers & Sellers Posted under: General Area in Sacramento | October 15, 2009 5:59 PM | 218 views | No comments Email Alerts Send to a Friend Post to Facebook Post to Twitter RSS View RSS feed


This week Governor Schwarzenegger signed several pieces of legislation into law that will affect real estate transactions in the state of California - all for the better!
SB 36, by Senator Ron Calderon (D-Montebello), creates licensing requirements for all residential loan originators. I feel this licensing requirement is long overdue and will hopefully create some additional accountability for mortgage lending professionals. SB 237, by Senator Ron Calderon (D-Montebello), creates a registration program for appraisal management firms. Also sorely needed...these AMC's have created some additional (and likely unintended) quality and timing issues for appraisals. SB 239, by Sen. Fran Pavley (D-Agoura Hills), makes it a felony to commit fraud on a mortgage loan application. DUH - this is a no-brainer! AB 260, by Assemblyman Ted Lieu (D-Torrance), bans negative-amortization loans and limits mortgage prepayment penalties to no more than 2% of the loan balance. AB 329, by Assemblyman Mike Feuer (D-Los Angeles), requires lenders to give more and clearer information to those interested in reverse mortgages, which let seniors borrow against their homes' equity. AB 957, by Assemblywoman Cathleen Galgiani (D-Stockton), allows buyers of foreclosed homes to choose local escrow officers, rather than being forced to use the escrow company chosen by the bank seller...I sure hope banks cooperate with this one. they may opt to accept the offer of another buyer that allows the bank seller to select its preferred escrow company. AB 1160, by Assemblyman Paul Fong (D-Cupertino), requires that mortgage loan documents be written in the same language the verbal negotiations were conducted in. previousnext Email Alerts Send to a Friend Post to Facebook Post to Twitter RSS View RSS feed

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Sunday, January 30, 2011
3106 Sumatra St. West Sacramento Home For Sale MLS#11003282
Tremendous home for sale in West Sacramento with 3 Bedrooms, 2 baths with 1640 square feet in a very livable floor plan.
This home is located in the Bridgeway Island subdivision just minutes from Downtown Sacramento just across the river in a neighborhood having its own elementary school and park within walking distance of the house for sale.
You can’t help but fall in love with this home and notice all the upgrades with expensive plantation shutters, designer colors and a luscious salt-water Lap pool.
What home buyers like so much about the floor plan this neighborhood is having the master bedroom on the north-side of the house and the other two bedrooms on the opposite side of the West Sacramento home for sale.
Let me know when you would like to have your own private showing of 3106 Sumatra St., West Sacramento home for sale. Be sure to check out the virtual tour on YOU TUBE of this spectacular home for sale by clicking on I want to see this home for sale.
This entry was posted on Thursday, January 13th, 2011 at 11:35 am and is filed under Homes For Sale. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
I am now a Certified HAFA (Home Affordable Foreclosure Alternatives) Short Sale Specialist!


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I am now a Certified HAFA (Home Affordable Foreclosure Alternatives) Short Sale Specialist! Posted under: Home Selling in Sacramento County, Financing in Sacramento County, Foreclosure in Sacramento County | October 13, 2010 7:49 PM | 149 views | 1 comment Email Alerts Send to a Friend Post to Facebook Post to Twitter RSS View RSS feed


Last month I attended a day-long training at the Sacramento Association of Realtors to augment my existing knowledge of the HAFA (Home Affordable Foreclosure Alternatives) Short Sale Program. Overall, it was an informative course. Much of it was review of the history of HAFA, the procedural steps of the program, and a review of the timeframes and paperwork involved. So, I took the tests today, and I am officially a "Certified HAFA Specialist." I have successfully closed so many short sales in our Sacramento-area real estate market, I feel like having this certification is a bit of a formality, but perhaps it will provide my short sale sellers an additional level of assurance that I actually know what I am doing (aside from my numerous short sale seller client references, good track record, the mentoring I have given other agents, etc)! previousnext Email Alerts Send to a Friend Post to Facebook Post to Twitter RSS View RSS feed



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Buyers - Take a Sneak Peak at the new Lending Good Faith Estimate
What is a Good Faith Estimate? A "GFE" is an itemization of all of the costs associated with obtaining a mortgage loan. It breaks out different costs, like loan origination, appraisal fees, estimated taxes, and prominently displays the estimated interest rate, length of the loan, etc. It also shows the "fully loaded" estimated monthly payment (fully loaded = total monthly payment amount of loan principle, interest, taxes and insurance). You can get GFE from multiple lenders and compare them side-by-side.
The current GFE is one page and resembles a spreadsheet...if you have never looked at one, they can be a little cryptic to decipher. I often help my buyer clients understand what they are looking at as they shop for a loan.
Most of this new 3-page GFE document is written in plain english, and really describes what the items are, which is really nice. There are specific sections with checkboxes that are not noted on the current GFE - like for example if the loan has a "pre-payment penalty" or a "balloon payment." I think it will be very difficult for dishonest lenders to fudge different fees and terms on the new form.
The one short-coming I think the new GFE has (that I am sure will be addressed by HUD with a revision or Addendum soon) is that no where does it explain or show the "fully loaded" payment. It only shows the principle and interest monthly payment amount (and does not factor in the full payment with the monthly allocation of property taxes and insurance)...which is only part of the true picture.
Overall I give HUD a thumbs up with regard to this new GFE...but PLEASE - HUD make that revision so the full PITI payment is clearly defined on the form!
Saturday, January 29, 2011
Can I do a short sale on my rental home?


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Can I do a short sale on my rental home? Posted under: Home Selling in Sacramento County, Foreclosure in Sacramento County, Rentals in Sacramento County | December 16, 2010 1:23 PM | 50 views | No comments Email Alerts Send to a Friend Post to Facebook Post to Twitter RSS View RSS feed


Can I do a short sale on my rental home? I get asked this question all the time by folks who own investment properties, and contrary to what many people think - the answer is yes, you can do a short sale on an investment property (aka, non-primary residence, rental homes, rental duplexes, etc). Oh really, you ask in disbelief? Yes really. I have closed several short sales under these circumstances....and I have several of them underway right now.
Do the dynamics of these short sales change at all? A little. Mainly because occasionally tenants occupy these homes and we have to delicately deal with showings, the existing lease agreement terms, and a few other things. Or if the house is vacant, we may want to strategize the best way to keep the house secure and free from vandalism or burglary.
In terms of how a short sale lender or bank looks at these short sales, again they are still looking at potential seller hardship, loss of market value of the property, and the lender's total losses. Short sale sellers of investment property should ask themselves:
Is the monthly rent covering the costs of the mortgage payment, in addition to other monthly operating expenses (like certain utilities, property taxes, maintenance, etc)? How big is my deficit every month, given the best case scenario of 100% occupancy? In other words, how much money am I loosing each month given the fact my tenants always pay their rent on time, and the house is always rented)?Has the property been vandalized by the current or former tenants? Is it 'rentable' in its current condition?Have you been unable to rent the house due to high area vacancy rates or other neighborhood factors?Were you an "accidental landlord?" In other words, for example did two people who owned homes individually get married, causing you to need to rent one of the homes in order to live together? Or perhaps did you inherit the home? Did you purchase the home for your college-age kids to live in, and now they have graduated and moved out? Did you co-sign for someone who now can not pay the mortgage?Did you suffer some other loss of income (loss of employment, pay reduction, etc.) and now have to choose between keeping your current, primary residence and letting your rental property go?There are many reasons to short sale investment or rental property. If you are contemplating a short sale for your Sacramento area investment or rental property, I welcome your call to see if we are a fit to work together. previousnext Email Alerts Send to a Friend Post to Facebook Post to Twitter RSS View RSS feed


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Sacramento Short Sales; who pays for what?
-Who pays the real estate agent commissions? In a short sale scenario, the lender(s) who agree to forgive debt and allow a short payoff of the loan(s) pay for the real estate agent (or Realtor) commissions - generally by absorbing the costs of the commissions out of the proceeds of the sale. As a side note, often times these commissions are re-negotiated by the lender(s) during the process. For example, if the seller and listing agent agree to a 6% total commission initially when the property is listed (usually then split in half to 3% to the listing agent, 3% to the selling agent), the lender may re-negotiate that fee later to perhaps 5% total (2.5% / 2.5%) or less. Note: Real estate commissions are always negotiable and NOT set by law or local custom.
-Who pays title insurance, escrow fees, and transfer tax fees? These are negotiable between buyer and seller when the offer is initially negotiated (before it is submitted to the lenders for approval). For example, perhaps the buyer and seller agree initially that the seller will pay for 100% of title insurance and escrow fees, 100% of county transfer tax, 50% the city transfer tax. The lender(s) may negotiate that the buyer pay a different split of these fees...however the portion that is paid by "the seller" is absorbed in to the overall debt forgiveness and short payoff. Occasionally you will see a lender agree to pay one of these fees, up to and not to exceed a certain amount (for example, they may agree to cover up to $750 of the escrow fee that costs $1200). Generally then, the buyer would cover the unpaid portion of that fee. So basically, again, the lender(s) will absorb many of those types of fees.
-Who pays for a home warranty? This is negotiable between buyer and seller when the offer is initially negotiated (before it is submitted to the lenders for approval). Generally though, I would prepare any buyer of a Sacramento short sale property to expect to pay for this cost, even if you ask the seller or short sale lender to cover it. In my experience, this is paid by the short sale lender in less than 20% of my approved short sales.
-Who pays for inspections or certifications? These are negotiable between buyer and seller when the offer is initially negotiated (before it is submitted to the lenders for approval). Again, most short sale lenders will not agree to cover things like pest or termite inspections, roof inspections, sewer line inspections, or any corresponding certifications. A lot will depend on the circumstances with the condition of the property, how many loans are involved, the buyers' loan program, if the property is in default, the length of time of negotiation, etc. As a safety net - buyers, do not expect that lenders will grant these requests. Generally short sale properties are sold "as-is" and sellers can not afford to make repairs anyway.
-Will the lender(s) give the buyer credits for closing costs? These are negotiable between buyer and seller when the offer is initially negotiated (before it is submitted to the lenders for approval). I have seen this vary widely from the short sale lender(s) agreeing to pay up to 6% closing costs for the buyer (including an instance of seller-funded downpayment assistance...which is no longer possible thanks to past legislation), to the short sale lender(s) rejecting those requests. Again, much will depend on the circumstances surrounding the sale of the property.
-Who pays delinquent property taxes or liens? Sellers - if you have not been paying your property taxes or county utilities, you really need to let your agent know this ASAP! I work closely with the title company on this to make sure that we know of any lien issues in advance, but because it can take several weeks or months to get approval, new liens may pop up during the lender negotiation process. When I negotiate short sales, one of my worst fears is that after the short sale is approved an unexpected lien will pop up. This has happened to me before, and for lack of a better way of describing it - this sucks! If you can let your agent know in advance that these items are unpaid, it will save lots of headaches all the way around. IF WE KNOW in advance that these liens exist, there is a great chance that the short sale lender will absorb these costs into their overall debt forgiveness and short payoff. IF WE DO NOT KNOW in advance that liens exist, once the short sale is approved - this will halt the transaction until we can find a way to pay these liens. The seller is often financially unable to pay them, the buyer does not want to pay, the agents commission has already been reduced, and the short sale lender has already taken a loss on the loan. Sellers - please save everyone a headache and communicate with your agent.
To make a bit of a sweeping generalization, the seller usually pays nothing out of pocket to close the transaction unless specifically asked to by the lender(s).
In perhaps one instance out of every six short sale transactions I close, the lender will request that the seller make a cash contribution to close the short sale. In these instances that I have negotiated, the sellers have had cash in the bank and were financially able to make that contribution...in those instances, the lowest cash contribution one of my short sale sellers has contributed was $1,000, and the highest was $5,000.
Also, you should note that in some short sale scenarios, the short sale lender will actually pay the seller "relocation assistance" to close the short sale. I have seen this in the range of $1,000 - $5,000. Not every Sacramento short sale transaction will qualify though.
Hope that answers some frequently asked short sale questions...cheers!
Movie Night at William Land Park in Sacramento


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Movie Night at William Land Park in Sacramento Posted under: Parks & Recreation in 95818 | September 2, 2008 11:29 PM | 901 views | No comments Email Alerts Send to a Friend Post to Facebook Post to Twitter RSS View RSS feed


The City of Sacramento Parks and Recreation Department presents a movie night at William Land Park on Friday, September 5th. The "Bee Movie" will be starting at dusk (which if Friday night is anything like tonight, that will be around 8:00pm), and will be at the section of William Land Park that is near Riverside and 12th Avenue. Admission is free!
This is just the first in a series of three Movies in the Park in Sacramento. On Friday 9/12, the movie "Cars" will be shown at Reichmuth Park, and on 9/19 "Enchanted" will be shown at Fremont Park.


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