great seasonal guide to home maintenance!

From Money Magazine:

You know that your house needs regular upkeep in order to stay in good condition. Not only can little maintenance issues become expensive and turn into major repairs, but nowadays problems that boom-time buyers might have overlooked can be huge liabilities when it comes time to sell, says James Carey, author of “Home Maintenance for Dummies.” Good thing that most crucial maintenance tasks can be done just once a year at a certain time. Read on for the right dates to mark in your calendar.

Winter

Clean the vents behind your dryer in the beginning of winter; you’re drying heavier clothes now, and they generate more lint. Clean vents will help your machine dry clothes more quickly, last longer, and you’ll lower the risk of fires. Hardware stores carry kits that can help.

Cost: $15 to $45.

Check your furnace filter once a month during the heating season for excess dust; you’ll want to change it once or twice a year so the unit operates more efficiently.

Cost: $8 to $20 each.

Make sure your sump pump is clean and operating properly before spring rains arrive. Lift the lever on the sump to make the float go up and wait for the motor to click on. If you have a battery backup, unplug the unit and test the pump again.

House seems cold? Remove and reinstall storm windows to make sure they fit properly.

Vacuum the refrigerator condenser coils — usually located on the bottom or on the back of the fridge. (Unplug it first, then use your vacuum’s brush attachment.)

Use your stuck-indoors time to knock off some annual fire prevention tasks. First, make sure your fire extinguishers haven’t passed their expiration date. Next, replace ground fault outlet circuit interrupters that aren’t working properly (when you hit the “Test” button the “Reset” should pop out; if it doesn’t, you can buy a new one at a hardware store).

Cost: less than $20 for a fire extinguisher and $10 to $12 for a circuit interrupter.

You need to change batteries ($6 for two nine-volt ones) in smoke detectors and carbon-monoxide alarms twice a year. An easy way to remember: Make the first switch on the same day you reset clocks to daylight saving time (March 14 this year), and again in mid-October. At the same time, test your smoke detectors; use a smoke-in-a-can product ($9) or blow out a candle underneath them.

Spring

Schedule an inspection and cleaning of your chimney once the heating season ends; that’s when many sweeps offer a discount. Also make sure to remove fireplace ashes to prevent moisture buildup, which can damage masonry.

Cost: $100 to $300, depending on the layout of your chimney.

Inspect your home’s exterior for loose siding or trim, cracks, and crumbling mortar caused by harsh winter weather, and examine your attic for any signs of leaks. If you’ve got siding, give it a wash using a garden hose and a solution of a third of a cup of laundry detergent per gallon of hot water. Work from the bottom up with a soft nylon brush (top down can cause stains).

Now that you can see your lawn again, cut down the thatch, or the layer of dead grass. If the thatch is more than half an inch thick, it can hurt your soil and encourage pests. You can hire a professional to de-thatch for about $30 to $100; if you want to do it yourself, rent a power thatcher and see instructions at garden.org.

Cost: $65 a day for a power thatcher.

Wash and treat (or paint) wood decks to prevent cracking before barbecue season arrives.

Cost: about $50 to $75 for five gallons of sealer.

Make an appointment to get your air-conditioning system professionally inspected and adjusted before the temperature hits 80°.

Cost: $75 to $175 per year for an HVAC service contract.

Before watering season, check pop-up sprinkler systems for leaks or clogs and be sure the spray isn’t going where it shouldn’t.

Termites and ants enjoy getting out in the spring weather too. Get your home professionally checked for pests before they have a chance to create structural damage.

Cost: about $75 to $100 for an average-size home.

Summer

Rainy spring? Look for signs of leaks and moisture in your basement, which can cause mold, fungus, and rust. Water on the wall probably indicates a bad downspout or grading that’s sloping toward the house. Standing water may require professional help to remove, so try to determine the cause of the leak so you’ll know which pro can help you fix it. Can’t figure out where the leak is coming from? Most home inspectors will offer advice.

Cost: $75 to $100.

Inspect your roof. Grab some binoculars and look for loose shingles, mold, mildew, or cracked chimney mortar. Catch problems early and you may avoid spending $2,000 to $12,000 (and up) for a roof replacement. See extensive damage? Get estimates for roof-replacement costs in your area at myremodelingproject.com.

Faulty garage doors cause tens of thousands of injuries every year. If something is in the path of the electronic beam sensor, the door shouldn’t close. To test, wave a broom across the beam while the door is in motion.

Check the caulking around tubs, showers, toilets, and sinks to make sure moisture can’t penetrate. If the caulking is black, that means mildew has gotten below it — replace it right away or risk water damage to the floor beneath.

Dog days of summer? Your heating system can take a break in the off-season, so drain and refill your hot-water heater to remove sediment. While you’re at it, test the heater’s pressure valve (designed to let out steam and prevent overheating during times of heavy use) according to the manufacturer’s instructions.

Replace the filter on your central air-conditioning system twice a year to make it more efficient.

Cost: $4 to $15 each; buy a bunch so you always have extras on hand.

Fall

Check your attic for holes or thin spots in the insulation, and make sure the caulking around doors and windows doesn’t leak. Keep in mind that your attic should be only 5° to 10° warmer than the outside air; any hotter and you could develop ice dams on your roof, which can cause water leaks (find out how much insulation is recommended for your area at energy.gov/insulationairsealing). Bonus: A well-insulated attic, ceilings, and walls can lower your energy bills by 30%.

If you’re in an area that freezes, have your sprinkler system professionally blown out — water in the pipes can freeze and cause damage. Take down garden hoses, drain and store, and put insulation around spouts.

Cost for the average home: about $100 to $200. (Cost for repairs: $250 to $800.)

Check and clean gutters to keep them free of debris. If you have a lot of trees on your property, install a product like the Gutter-Brush guard (gutterbrush.com) to keep leaves and flotsam from accumulating.

Cost: $200 to $400 for a 2,000-square-foot home.

Want healthy spring grass? Aerate your lawn by removing little plugs in the soil.

Cost: $75 to $150 a day to rent an aerating machine, so go in with a neighbor (or two).

Prune and cut back trees once they’ve dropped their leaves, so the branches don’t scratch your home’s siding.

Three New Proposed Developments near Homestead Park

Article from Chapel Hill News:

CHAPEL HILL – Three proposed developments could create dozens of new multi-family homes, shops, offices and a new church west of Homestead Park.

On Thursday, Capstone Properties held a design charrette for the public to help plan an apartment or condominium project on 31.5 acres just west of the Southern Human Services Center on the south side of Homestead Road. The parcel abuts the northern edge of UNC’s Horace Williams Tract, the future site of the Carolina North satellite campus.

Next month, the Cary-based land-planning firm The Design Response will go to the Planning Board with a proposal for 23 townhomes and two office/retail buildings. Construction would total 77,567 square feet on 9.2 acres on the north side of Homestead Road, across the street from the Capstone proposal.

The project, called Bridgepoint, would require tearing down two single-family homes. The townhomes would average nearly 2,200 square feet each, with three of them affordable to those earning less than 80 percent of the local median income, in compliance with town policy.

This mixed-use project could go to the Town Council for approval as early as April.

The Episcopal Church of the Advocate, which has met in temporary locations over its first several years, has also proposed its own 42,300-square-foot complex on Merin Road, slightly farther west along Homestead Road. Over a 15-year time horizon, the project would eventually include a welcome center, meeting space, retreat center, outreach building, cottage and parsonage.

Site engineer Phil Post said the first building would total 3,600 square feet, comprising an office and worship space, not much larger than the house that currently sits on the site.

The church proposal is scheduled for review by town advisory boards beginning in March.

The Inter-Faith Council for Social Service is also proposing a new men’s homeless shelter in that area, near the intersection of Homestead and Martin Luther King Jr. Boulevard. Officials from the IFC, the town and the university are trying to schedule meetings with concerned neighbors before the IFC submits a formal development application.

Now You Can Get Help with Your FHA Loan Before you Fall Behind

Read this article from CNN Money to learn more:

http://money.cnn.com/2010/01/22/real_estate/easier_FHA_help/index.htm

7 Tips for Buying Foreclosures

Here is a great article from CNN Money offering tips for those wanting to be foreclosures.

Foreclosures are dominating the housing market. Right now, there are 1.5 million such homes for sale, and more are expected to be available soon. That provides both opportunities and pitfalls for bargain hunters.

Just because prices are low doesn’t mean you should make snap decisions or buy something that isn’t right. Here are 7 tips for making sure you don’t get taken for a ride.

1. Don’t get caught up in a feeding frenzy

“Everybody and their grandmas are trying to buy foreclosures,” said Glenn Kelman, CEO of Redfin, an online, discount broker. But that doesn’t mean you should lose your head.

Banks put repossessed homes back on the market at cut-rate prices because quick sales help avoid the expense of upkeep, such as property taxes, insurance, heat and electricity.

Those lowball prices represent golden opportunities, but they also attract dozens of buyers who may bid until homes are no longer bargains.

Don’t get caught up in a bidding war. Instead, carefully calculate what you want to spend and do not exceed that price.

2. Contact lenders directly

Smart buyers establish relations with asset managers at banks. This may reward them with inside information or first crack at new foreclosures hitting the market.

In the case of a short sale, for example, it can give the inside edge. If a buyer is pursuing a short sale — buying a home for less than what the current owner owes on the mortgage — she should talk directly to the property’s asset manager. That way, if the short sale falls through and the bank repossesses the house, the asset manager knows she is still interested. It could lead to a quick sale without other bidders.

3. Get pre-approved from the lender you want to buy from

If you’re trying to buy a property from, say Bank of America, it can help to get a pre-approved mortgage from Bank of America. Doing so may cause lenders to look more favorably on your bid if it’s similar to others.

Plus, you’re not locked in if other lenders offer you better terms. You can always change your mind and get your mortgage from another source.

4. Consider fix-ups

Most REOs, the industry term for bank owned properties, are sold as is. “The conventional wisdom is that banks will do nothing to the houses before the sale,” said Kelman.

That can be problematic today because so many foreclosed homes are in less-than-mint conditions. Often, the former owners were struggling to pay their bills and may have neglected routine maintenance. Or, they may have trashed the properties before leaving

In 25% of cases, homebuyers persuade lenders to fix some of the problems before the sale closes. Most of the time, banks would rather sell the house to the next available bidder — one who doesn’t ask the bank to pay for repairs.

So be willing to consider a home that needs some work — but budget accordingly.

5. Hire a real estate attorney

Once banks agree to sales, they often want to move fast and load contracts up with legal mumbo jumbo. As a result, buyers often do not have the time or expertise to figure all the angles.

The solution is to hire a real estate attorney — even in states where home sales are usually completed without one. Considering you’re making a six-figure investment, the legal fees are cheap insurance against the risks.

6. Wait to make an offer

Homebuyers may be well served to wait before making an offer. Let the house sit on the market for a few days, giving others a chance to set the bidding tone. Then jump in.

“Talk to the agent selling the property,” said Kelman. “The agent may tip his hand. Call up and ask, ‘Should I make an offer? What should I come in at?’”

The agent may tell you he has offers at, say $300,000 and you should bid a bit higher, giving you an advantage over earlier bidders.

7. Tour properties with contractors

With so many REOs in seriously deficient shape, it’s essential to go over every inch with someone who can spot problems and tell you how much it will cost to remedy them.

A foundation crack can be a minor problem or a deal breaker, and most ordinary homebuyers have no way of telling the difference. Like an attorney, a contractor can be very worthwhile insurance. 

What is a HELOC?

A home equity line of credit (HELOC) is a type of second mortgage that gives the borrower a revolving credit line similar to that of a credit card. Instead of distributing the loan in one lump-sum, the lender allows the borrower to draw from the funds whenever he chooses. HELOC loans are known for offering high limits with low-interest rates. Since HELOCs are technically home loans, many state and federal laws make HELOC interest tax deductible. It is important to note that HELOCs are secured loans that use the borrower’s house as collateral. If the borrower defaults on the loan, the lender may force foreclosure proceedings to recoup its loss. If the foreclosure does not generate the full amount due, the lender may seek a deficiency judgment requiring the borrower to pay back the additional funds. Here’s how the typical HELOC process works:

Step 1 – The borrower applies for the HELOC. In order to qualify for a HELOC, the borrower must have accrued equity in his home (i.e. there must be a difference between the amount the borrower owes on the home and the current value of the property). The bank will also look at the borrower’s credit score, his debt-to-income ratio, and his employment.

Step 2 – The lender awards the loan and sets the HELOC limit. Because the HELOC uses a borrower’s home as collateral, the credit limit is determined by the value of the property. The limit will be set by subtracting the balance the borrower owes on their first mortgage by a percentage of the appraised value of the home (usually about 80%). For example: A borrower purchases a home for $300,000 and now owes $250,000. His home currently appraises at $400,000. If the lender uses a standard 80% guideline, the borrower will receive a credit line of $70,000.

Step 3 – The loan enters the draw period. The “draw period” is a span of 5-10 years during which the borrower can withdraw money whenever he chooses. The borrower will usually be given a checkbook or a special credit card to use for withdrawals. When money is taken out, the borrower will receive a monthly bill and must make a minimum payment (sometimes interest-only). When no money is withdrawn, the borrower will not be charged. Whenever the borrower has withdrawn money, interest accrues. Because most HELOCs have adjustable interest rates, the percentage the borrower is charged for interest will vary from month to month.

Step 4 – The loan enters the repayment period. During the 10-20 year “repayment period” the borrower cannot make any more withdrawals from the line. To determine the monthly bill, the total amount withdrawn is divided by months allotted for the repayment phase. For example: A borrower receives HELOC with a $100,000 credit limit and a 10-year repayment period. By the end of the draw period, he has withdrawn $80,000. That amount will be split between the 120-months in the 10-year repayment period. His monthly payment for the next ten years will be $666.66 plus interest. ($80,000 / 120 months). Although the general process is the same for most HELOCs, individual loan terms vary. Some HELOCS eliminate the repayment period and make a single balloon payment due at the end of the draw period. Some HELOCs use different methods of determining the borrower’s credit line. Before signing application papers, ask your lender for the specific terms of your HELOC.

Durham, NC One of the best places to live

Durham was voted by U.S. News as one of the best places to live in 2009.  Click on the link below to read the article!

http://www.usnews.com/articles/business/real-estate/2009/06/08/best-places-to-live-2009.html

Short Sales

A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold.

In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank’s loss mitigation or workout department. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale. Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower’s financial situation.

A short sale typically is executed to prevent a home foreclosure, but the decision to proceed with a short sale is predicated on the most economic way for the bank to recover the amount owed on the property. Often a bank will allow a short sale if they believe that it will result in a smaller financial loss than foreclosing as there are carrying costs that are associated with a foreclosure. A bank will typically determine the amount of equity (or lack of), by determining the probable selling price. For the home owner, advantages include avoidance of a foreclosure on their credit history and partial control of the monetary deficiency. A short sale is typically faster and less expensive than a foreclosure. In short, a short sale is nothing more than negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount. It does not extinguish the remaining balance unless settlement is clearly indicated on the acceptance of offer.

Short sales are common in standard business transactions in recognition that creditors are not doing debtors a favor but, rather, engaging in a business transaction when extending credit. When it makes no business sense or is economically not feasible to retain an asset, businesses default on their loans (called bonds). It is not uncommon for business bonds to trade on the after-market for a small fraction of their face value in realization of the likelihood of these future defaults.

Jonathan Kane is our Buyer’s Agent and is an expert in Short Sales and Foreclosures.  If you would like more information on Short Sales and Forecloures, please give us a call at 919-883-4800.

$8,000 Tax Credit

The American Recovery and Reinvestment Act of 2009 went into effect on February 17th 2009. First-time homeowners will receive up to an $8,000 tax credit when they purchase a home between January 1 and November 30, 2009. The credit is equal to 10% of the purchase price, capping out at $8,000. Unlike the $7,500 credit that could be claimed in 2008, the new credit doesn’t have to be repaid. It’s important to note that for the purposes of this law, “first-time homebuyer” is defined as someone who hasn’t owned a home in the previous three years. There are also some income and residential restrictions that come with the credit. Married couples have to earn less than $150,000 and singles have to earn less than $75,000. Also, you must live in the residence for three years or you’ll have to pay back the credit. In addition to the $8,000 credit, there are other items that are tax deductible, including: Mortgage interest paid Real estate taxes paid Closing costs Moving expenses American Recovery and Reinvestment Act of 2009 went into effect on February 17th 2009. First-time homeowners will receive up to an $8,000 tax credit when they purchase a home between January 1 and November 30, 2009. The credit is equal to 10% of the purchase price, capping out at $8,000. Unlike the $7,500 credit that could be claimed in 2008, the new credit doesn’t have to be repaid. It’s important to note that for the purposes of this law, “first-time homebuyer” is defined as someone who hasn’t owned a home in the previous three years. There are also some income and residential restrictions that come with the credit. Married couples have to earn less than $150,000 and singles have to earn less than $75,000. Also, you must live in the residence for three years or you’ll have to pay back the credit. In addition to the $8,000 credit, there are other items that are tax deductible, including: Mortgage interest paid, Real estate taxes paid, Closing costs, & Moving expenses.  If you are a first time homebuyer, take advantage of this amazing opportunity.

Moving to North Carolina

The Wall Street Journal (www.wsj.com) had a very interesting article in late December, 2008 about migration between states and the affect that the current recession might be having on it. There has been, as most of us are aware, a long-standing movement of population in this country from the North to Southern and Western states. Using statistics gathered from the latest US Census Bureau for the 12 months ending 7/1/08, the article states that while these long-term migration patterns still exist, the early months of the recession seem to have slowed the movement from colder, more expensive Northeast and Midwest markets for the warmer Western and Southern states. The main reason sighted for this ‘lull’ in the rate of migration between states was that most folks move for jobs, and when the rate of job growth slows, so does movement. Also, many people were unable to sell their existing homes, forcing them to stay put for the time being.

In spite of this, the four states that had the greatest net rate of migration from other states were Utah, Arizona, Texas and North Carolina. South Carolina, Georgia and Tennessee were all in the top 10 in population growth from other states.

Chapel Hill, North Carolina

Chapel Hill is one of those towns that has an abundance of charm and personality. Although it is home to the University of North Carolina, Chapel Hill is much more than just a college town. It is a rare blend of southern charm and hospitality, new trends, tradition, techno-savvy, good food, healthy living and great weather. As a popular North Carolina college town and retirement destination all rolled into one, Chapel Hill combines the ‘young and the restless’ with a seasoned, wise, but still very active baby boomer population. It has great restaurants along Franklin Street, intelligent residents that are very focused on healthy living, and great parks. The University brings energy, intellectual curiosity, culture and a great long-standing college basketball rivalry (with neighboring Duke University) to Chapel Hill. Combine this with the scientists, researchers, patent holders, Nobel Prize winners and other innovators that arrive via their jobs at nearby Research Triangle Park, and you’ve got a unique populace. With nearby lakes, the beach 2 hours to the east and the Blue Ridge Mountains an easy drive to the west, it’s easy to see why Chapel Hill is called ‘the Southern part of heaven’!