Credit Scores vs. Mortgage Rates

Mon, Jun 8th 2009 6:30 am by Alan Donald Mortgages

Recent changes in the mortgage industry has made Fannie Mae (and most lenders) to review their pricing for conforming loand (under $417,000) to better reflect risk by adjusting their pricing (i.e. the interest rate charged on mortgage loans) according to the applicant's credit score, and loan-to-value ratio (LTV).

The lower the credit score, or the higher the LTV, the higher the interest rate a borrower will be charged. Many clients call me excited about low interest rates they see advertised by lenders. However, those are the interest rates that PREFERRED risk borrowers will get - those with a credit score above 720 and an LTV below 80%.

Kathy Durham from Raven Mortgage sent me an exam...

Getting Ready for Hurricane Season

Sun, Jun 7th 2009 9:30 am by Alan Donald General

Nature is powerful: No matter where you live on the planet, there is always a danger of some sort. Earthquakes, floods, tornadoes, droughts, mudslides, tsunamis and - hurricanes. June 1st was the start of the Hurricane Season for the East Coast of the U.S.

In the Lowcountry we must be prepared for the eventuality of a hurricane. Although none have had a direct hit on Charleston since Hurricane Hugo did in 1989, we need to be prepared for this potentially devastating event. From a personal point of view, hurricanes are predictable, pepole can evacuate and get out of the way. From a real estate perspective there are a few things that property owners should plan for in advance:

  1. Check you...

The Ravenel Bridge

Wed, Jun 3rd 2009 10:00 am by Alan Donald General

About two years ago, the Charleston and Mount Pleasant landscapes changed for good: Old Bridge over Cooper RiverThe two old, ricketty bridges that connected the Charleston Peninsula with Mount Pleasant were permanently replaced with a gorgeous new structure that altered the city's skyline forever and has become an identity icon for Charleston.

Ravenel BridgeThe Ravenel Bridge is a cable-stayed structure spanning the Cooper River. Its main span is 1,546 feet (471 m) long (the longest of its kind in the Western Hemisphere) and carries 8 lanes of traffic, plus a pedestrian and bike path.

The new bridge not only improved traffic dramatically. The following Post & Courier video talks about the positive effect the bridge has had on l...

Hot Market: Charleston SC Sets Up For Strong Recovery

Tue, Jun 2nd 2009 1:45 pm by Alan Donald Real Estate

I read this article in RealtyTimes recently - it has an encouraging forecast for our Charleston Area Market...

Charleston's Ravenel BridgeHot Market: Charleston SC Sets Up For Strong Recovery

by M. Anthony Carr

If shrinking inventory and dropping sales prices are any indicator, Charleston, South Carolina is about to follow suit of housing markets such as Miami, Washington DC and Las Vegas, that have turned around in recent months. Homes available for sale in Charleston have dropped nearly 10 percent in the last month compared to a year ago.

The Charleston Trident Association of Realtors reported its inventory has dropped more than 1,000 units in April to just over 10,000 houses on the market. In addition, med...

Buying Property from Foreign Sellers

Tue, Jun 2nd 2009 7:30 am by Alan Donald International Real Estate


DID YOU KNOW - That the BUYER needs to withhold 10% of the purchase price when purchasing a property from a foreign Seller?

Here is an excerpt from the IRS website:

Withholding of Tax on Dispositions of United States Real Property Interests
The disposition of a U.S. real property interest by a foreign person (the transferor) is subject to the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) income tax withholding. FIRPTA authorized the United States to tax foreign persons on dispositions of U.S. real property interests.

A disposition means "disposition" for any purpose of the Internal Revenue Code. This includes but is not limited to a sale or...

Patience is a Virtue (That Helps Get Deals Done)...

Sat, May 30th 2009 4:00 pm by Alan Donald Sellers

Sellers deal with anxiety, especially if they are also buying a home and depending upon the sale and closing of their existing home.

In addition, Sellers may have to deal as well with Buyers' anxiety. For example, you may have reached an agreement with the Buyers and signed the contract for the sale of your home. After the contract was ratified, you notice that the Buyers begin to behave strangely, getting somewhat agitated and making additional (sometimes unreasonable) demands, like asking you to include your new washer and dryer (that did not convey), or may start questioning the structural integrity of your home.

It is important to remember that people (especially first-home buyers) ...

NEWS FLASH: Buyers May Get Loans to Use $8K Tax Credit Toward Closing Costs

Fri, May 29th 2009 4:45 pm by Alan Donald Buyers

FHA-approved lenders received the go-ahead to develop bridge-loan products that enable first-time buyers to use the benefits of the federal tax credit upfront, according to eagerly awaited guidance from the U.S. Department of Housing and Urban Development on so-called home buyer tax credit loans that was released today.


Who Works For Whom?

Fri, May 29th 2009 4:00 pm by Alan Donald Real Estate

In South Carolina, state law maintains that the REALTOR must represent at least one of the parties in the transaction (cannot be neutral). Consumers have the option to hire an agent (become a CLIENT with fiduciary responsibility from the agent) or remain a CUSTOMER (at arm's length) and represent him/herself in the transaction.

Agency in SC


The LISTING AGENT always represents the seller. Sometimes a buyer will purchase a home with the help of the listing agent. In this case, known as DUAL agency, the agent assists both the buyer and the seller in the transaction. However, it is also possible that the buyers want an agent representing their interests exclusively (BUYER'S AGENT) , a service which ...

Mortgage Rates on the Way Up?

Thu, May 28th 2009 5:56 pm by Alan Donald Mortgages

Flying MoneyYesterday mortgage bonds had their worst performance since last October, and as a consequence rates climbed about a half of one percent! It appears that the Treasury has been issuing bonds (i.e. like printing money) to fund all these massive rescue programs, and yesterday supply of bonds exceeded demand and prices for  whole bond market fell, causing interest rates to climb to try to attract buyers.

If the bond market does not bounce back through the several levels of resistance that it went down through, mortgage rates are going to stay higher for a while. It seems that those buyers and investors that were waiting for the 4% mortgage rates are going to have to make a tough decision.


Extra Costs When Buying a Home

Wed, May 27th 2009 4:00 pm by Alan Donald Buyers

Home on BillsExtra Costs When Buying a Home

When you are buying a new home, there are many costs on top of the purchase price that you need to be aware of, because they may factor into your future affordability, and your ability to close the transaction. Some of these expenses are one-time charges, others are monthly or annual fees.

Here is a list of some of these costs:

Property Taxes - paid in arrears (at the end of the year) and prorated as of the date of closing. Your lender will normally collect monthly 1/12 of the estimated annual property tax, place it in your escrow account, and pay the taxes for you at the end of the year. The closing attorney will collect some prepaid taxes at closing to...

Homes on Busy Streets

Tue, May 26th 2009 9:45 am by Alan Donald Buyers

Busy StreetEvery day when you drive to work you see a beautiful home with a "For Sale" sign on a busy road. Given the size and quality of the home, you think it must be priced well above your price range. After months of curiosity, you call for information and you find out it is surprisingly affordable, priced much lower than similar homes on quiet streets! You schedule a showing, and you love the home...

Homes located on busy streets may represent great value for the money. Some buyers who are very sensitive to noise, have young children or pets, may automatically rule out homes on busy streets. If the sellers have made pricing concessions to reflect the location of the home and you are not bother...

Mount Pleasant Farmer's Market

Mon, May 25th 2009 2:15 pm by Alan Donald General

New Mt Pleasant Farmer's Market Re-Launch Video


Last week the new and improved Mount Pleasant Farmer's market was re-launched, as part of the Coleman Boulevard Revitalization project. The Farmer's Market meets every Tuesday afternoon next to the (also brand new) Moultrie Middle School and offers local vendor's produce, crafts and services, as well as entertainment for all family members. Here is a link to the ABC News story:

The "Dry" Closing

Sun, May 24th 2009 12:15 pm by Alan Donald Real Estate

House MagnifiedBuyers and sellers have agreed to terms and conditions, the buyers have done their inspections, repairs have been agreed and done by the seller, the attorney has done the title work, the appraisal has been done, everything seems going perfect to close on time...

Enter, the lender's UNDERWRITER.

During the housing boom that ended three years ago, underwriters were just an extra check, and they were not really very concerned about confirming every little detail on the loan application, the contract and the origin of the deposit money. Maybe that's one of the reasons why we are in this mess altogether!

This has changed! Today underwriters have (it seems) unlimited power to minutiously dis...

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Need Money?

Sat, May 23rd 2009 12:00 pm by Alan Donald Buyers

Money PathBefore you start shopping for a home, it is essential to get pre-approved by a lender. This does not mean that you cannot keep "shopping around" for the best loan while you look at homes. Once you have a signed (or "ratified") contract, you will need to choose a lender, submit a formal application and many times pay a fee (usually the cost of the appraisal) to the lender.

So, how do you choose the right lender?

It is important to choose a reputable lender, but also one that has the right loan program to fit your particular situation. It is important to carefully compare rates, origination and processing fees, terms, conditions and restrictions before making a final decision.

Some lend...

Buy or Sell First?

Fri, May 22nd 2009 11:35 am by Alan Donald General

Home on BillsMany people are looking at real estate prices and thinking it's a great time to buy. And they are right. The problem is - they may need to sell their home first to complete their downpayment, and in a buyer's market, this sometimes can be a challenge.

It is important that you sit down with your REALTOR® and explore all the options available to you. Here are some of them:

  1. Buy first, sell later. Advantages: You can take advantage of current buying opportunities and low interest rates. Disadvantages: You may not qualify for both loans, and if you do, you may have to pay two mortgages until your old home sells. You may also explore the availability of a "bridge" loan from your lender to h...

Spoleto Art Festival Starting!!

Thu, May 21st 2009 12:14 pm by Alan Donald General

Theater MasksSpoleto USA, the 2-week festival that makes Charleston a bright spot with music, art, theater and dance performances and exhibits is opening tomorrow, May 22nd!

The opening weekend include a performance of the opera Louise at the Gaillard Municipal Auditorium; the Don Juan tale Don John, at the Memminger Auditorium;and an Alvin Ailey American Dance Theater performance. Check out all the events here.

This year the festival features one of my favorite dance troupes, the Alvin Ailey American Dance Theater...




The Perfect "Storm" for Buyers

Tue, May 19th 2009 1:45 pm by Alan Donald Buyers


The sub-prime mortgage troubles of 2006-2008 has left the mortgage industry limping - causing the failure of a number of well-known banks.

The Federal Government stepped in early September, 2008 to rescue Fannie Mae and Freddy Mac, the two giant, quasi-governmental companies that buy the bulk of the mortgage loans from commercial banks and were experiencing difficulties. This "rescue" signalled the intention of the government to shore up the mortgage industry and help the housing market lead the economy out of the doldrums.

With the economy stalling, the Federal Government has stepped in to provide a stimulus to help the housing market. A combination of fac...

The Ups and Downs of the Real Estate Market

Sat, May 16th 2009 1:45 pm by Alan Donald Real Estate


So, you noticed that three years ago, your next door neighbors put their house on the market one morning, and by that afternoon they had multiple offers to choose from. Now you have been trying to sell your home for six months and there's just no action...!

The real estate market is unpredictable in the short term, since many factors (like interest rates, the amount of new homes being built and the economic health of the area) come into play. In the long term, the real estate market behaves just like other economic markets. It is a cyclical market (and in many places also seasonal). And it is driven by underlying supply and demand.

In a strong sell...

Good News! Mt. Pleasant Housing is Now More Affordable!

Sat, May 16th 2009 9:15 am by Alan Donald Mt Pleasant Real Estate Market

For the first time since 2002, the Personal Income line and Median Sales Price line will intersect again this year, showing the effect that the softening of the real estate prices in Mt. Pleasant has had on home affordability: The green line shows the average percentage of household income that a household spends on housing - we are back to the level of affordability we had at the beginning of the century! This is good news for first-home buyers and for families who need to upsize their home! Peak inventory in Mt Pleasant happened back in July 2007, and, given that demand has decreased noticeably, housing is forecasted to remain affordable for a while - we still have a large inventory to ...

What Would Your Future Mother-In-Law Think?

Wed, May 13th 2009 3:30 pm by Alan Donald Sellers

Mother-in-lawYou can bet on it - the KITCHEN is one of the key areas of a home that most buyers will look at to short-list their preferred homes from a long list of available listings.

A smart seller will devote time, attention and money to make the kitchen sparkle! Although many buyers want an updated kitchen (solid surface countertops, modern cabinets, stainless steel appliances, etc.), your kitchen does not have to be state-of-the art to be appealing.

Think first impressions: What would you do to impress your future mother-in-law if she was coming to visit you for the first time?

The first step towards enhancing the appeal of your kitchen is giving it a thorough cleaning and tidying up. Make s...

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