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Buying a Short Sale Home? Keep This in Mind

by Mary Gilbert


One of the greatest myths in the world of real estate is that buying a home that’s in a pre-foreclosure state, or one that has already been foreclosed upon, will get you the very best deal possible. This is inaccurate for a number of reasons, though if you know what you’re looking at you can sometimes snag a bargain. There are a few things you need to know before making that leap the first time.

 

What is a Short Sale?

Short sales happen because a homeowner is in big trouble financially and needs to unload their house. They may be in a negative equity position (underwater) or simply lack the equity to sell their home. There was a time when homeowners had to miss a few payments before lenders would consider a short sale, but today there are conditions, like a sudden loss of income, that can make a short sale possible faster.
 

Short sales save the homeowner from a long and potentially credit damaging foreclosure. They save the bank from having to get lawyers involved to collect the home that’s collateral for the mortgage that’s in default. They don’t do anything for a buyer by design (that’s not to say that you can’t benefit from them, they just didn’t really consider buyers when creating this out for homeowners in trouble).
 

Buying a Short Sale Home: The Basics
 

To successfully navigate a short sale, you’re going to need a few things:
 

  1. An experienced real estate agent. Writing a contract for a short sale is not like writing a contract for a standard home. There are usually a variety of clauses that must be included, as well as knowledge of what will and won’t be accepted in said contract to consider. Your interests have to be protected, which can really bloat a standard purchase agreement with a lot of extra verbiage.
  2. A really good home inspector. When people ask their banks for permission to sell short, they’re not doing it because they’ve been spending all their extra money fixing up the place. Often, these homes are in some amount of disrepair due to neglect. When finances are tight enough to get a short sale approved, you can bet home improvements are far from the current owner’s mind.
  3. Patience. It can take a very long time to get a short sale approved. If you’re looking to buy one as an investment, that wait might not matter, but if you want a place to call home, it’s going to be frustratingly long. This is because not only does the homeowner approve the contract, the bank has to, as well. If there are two or more banks involved, so much more the trouble. Buckle in, because it can take six weeks – six months — to close.
  4. Liquid or liquidatable assets. Depending on the state of the home, you will likely have to put some money into it right away. A leaky roof and HVAC with issues aren’t cheap to fix.


It is highly recommended that you use a real estate agent to purchase a short sale. This point cannot be stressed enough. Short sales are not always deals, as stated above, because banks know what their property is worth — they’re not going to let you steal that house for a song. The banks involved are also unlikely to make repairs or give you any sort of concessions.
 

How Can Banks Afford to Do This?
 

The next time someone tells you that mortgage insurance is a waste and does nothing for anyone but the bank, remind them that MI is what makes short sales possible and often prevent long-term credit damage during a foreclosure. When a home qualifies to be a short sale, the bank is using proceeds from a claim against the mortgage insurance to make up the difference between what the sellers owe and what a buyer is giving.
 

MI can help prevent something known as a “bleeding foreclosure.” This is a foreclosure (or short sale) that has sold, but has a balance remaining that cannot be forgiven. Not all homes sold short will “bleed,” but it’s a potential in many states, especially if you’re not carrying MI on your mortgage. So, rather than pay extra every month for MI, you’ll be paying monthly for the outstanding balance on a house you no longer own.
 

Ready to Shop for Short Sale Homes? The Mary Gilbert Group is here to help with all your Real Estate needs! 541.371.5500 or [email protected] 

By: Homekeepr, Saro Cutri

Your Need to Know Guide to Buying an Older Home

by Mary Gilbert


For a lot of homebuyers, buying their dream home means choosing an older structure that has passed the test of time. These grand places have an undeniable charm about them, with classic styling that can be adapted to nearly any taste. Older homes can be incredible places to live and love, but no home is perfect. The history of your older home may include skeletons in the upstairs bedroom closet.

 

Five Amazing Reasons to Choose an Older Home

Buyers who are into the details are going to love owning an older home. Not only do you get all those little bits of period hardware, real wood floors and intricate trim work, your home has a real history that you can trace should you be so interested. Older homes can become a real love story really fast.

 

There are a lot of reasons to choose an older home, here are five to get you started:

 

The neighborhood is established. You may not be giving any thought to this particular item right now, but when you’re living with the sound of bulldozers, skid loaders and other heavy equipment nearby as they add even more streets to a newer neighborhood, you might wish you had gone another way. Established neighborhoods don’t give you a lot of room to move, but you also know exactly what to expect day to day.

 

Mature landscaping! Even if you’re not a gardener, you can appreciate that 50 or 80 year old shade tree that protects your house like a giant leafy umbrella. If past owners put in plants, you may also have bought into a hedge or foundation plantings that will give you lots of green without lots of effort.

 

High ceilings. Although the types of ceiling treatments that are in modern homes rarely pop up in older homes, you may find high ceilings in older homes (this will depend on how old of a house you’re looking for). Before air conditioning, those high ceilings helped keep occupants cooler in the summer. Today they give you a more spacious atmosphere and more room for vertical storage.

 

Lots of natural light. One of the best features of many older homes is the sheer number of windows that have been installed. So many windows means so much more light inside your home. When you’re buying a glass house, though, make sure that those windows have been replaced or brace for high winter energy bills.

 

You become part of the story. Older homes tell the story of the lives of past owners, in small and large ways. Every owner left a mark somewhere in that place, just like you will. For example, you may decide you’re not so fond of the carpets, instead choosing to recover the wood floor underneath. Your fingerprint was just added to the collection.

 

Owning an older home can be a home ownership dream come true. But don’t fall headfirst yet. Read on so you know when to walk away.

 

Five Reasons to Reconsider That Older Home

Although older homes can be charming and even decadent with the details, there’s a lot more to them than history and natural light. Every house is the result of its cumulative care over its lifetime. The longer the house has been around, the more care (or neglect) it receives. Even so, there are many reasons to be wary when it comes to buying an older home.

 

Vital systems may not be to code. When that house was built in 1940, there weren’t really building codes to adhere to. In fact, that house might have come from a catalog and was shipped in pieces for a homeowner to build like a giant Lego set. The fact that it’s still standing is probably a good sign, but you’ll want to have a very thorough home inspection before you get your hopes up too high.

 

Owners adding defects when trying to repair things. Homeowners regularly make repairs without the proper permits or inspections, leaving you to wonder how good the work really went. Whether the repair was made in the 60s or last week, discovering that a closet light was wired using lamp wire is a terrifying discovery that should leave you wondering what other “repairs” are hiding behind the wall, in the attic and under the floor.

 

So many windows means thermal leakage. All that natural light is awesome, until it gets cold or hot — then you’ve suddenly got a major issue with thermal leakage. Even the best weather seal isn’t much on a single pane window when compared to modern engineered double and triple paned windows with Low-E coatings. If you like a drafty house, by all means go for it. If not, at least look for a place with upgraded windows.

 

Add-ons should get the side eye. Above we discussed how each owner touches a house in a unique way. One of those ways is to add more square footage. There are good add-ons that flow seamlessly from the original structure to the new part without it being obvious. Then there are the others. Does this place have something that’s akin to a shanty attached to the back side and called a bedroom? Run away.

 

Infestations. Another gift former owners may leave you is pest infestations. From bats to cockroaches and mice, older homes are accidental havens for all sorts of creatures. Along with a termite inspection, you definitely want to have a pest control expert out to look for signs of other things that you’d probably rather not be sharing your home with.

 

Living in a remodeling zone is not a party. Some people gravitate toward older homes because they believe this will save them a lot of money. There’s certainly a chance of that, but market forces are finicky, so you definitely want to talk to some pros before putting the numbers together. Even if you do find that you’re sitting on a gold mine, consider what this is going to do to your life and family. Living in a construction zone means that you never get away from the destruction and that you’re potentially dumping a lot of money into upgrades and fixing old “repairs.”

 

Is an Older Home Right for You and Your Budget?

It’s one thing to dream a little dream and yet another to turn that dream into a reality that may have unforeseen results. This is why it’s really important to talk to your Realtor and other home pros before making an offer on an older home.

 

If you are thinking about purchasing a home, let The Mary Gilbert Group help! 541.371.5500 or [email protected] 

 

By: Homekeepr 

Getting to Know FHA Mortgage Financing

by Mary Gilbert

While you’re dreaming about your Starter Home, don’t forget that you’re going to need a Starter Mortgage to pay for it. The mortgage programs offered through the Department of Housing and Urban Development’s Federal Housing Authority can be easy ways for borrowers with limited or lightly bruised credit to enter the housing market with confidence.

Of course, like with any mortgage, FHA loans aren’t for everybody. But they are really good for many people. Let’s get to know the loan most people are talking about when they say they need an “FHA loan,” the FHA Basic Home Mortgage Loan 203(b) (what a mouthful!).

Who Is This Loan For?

Before you waste your time by reading this whole blog just to learn that you’re not a good candidate for this loan, let’s get it all out upfront, shall we? FHA mortgages are good for a wide range of people, especially those with credit scores in the mid- to upper 600s with minimal down payments.

FHA is forgiving of some sins, including unpaid medical bills, but is less tolerant of monthly payments for things like revolving loans and secured loans (know as your “debt-to-income ratio”). Where Fannie Mae’s conventional loans may let you have upward of about 45 percent of your income going to monthly debts and housing, FHA mortgages are much more selective. Your housing debt can’t exceed 31 percent as of the writing of this blog; your overall debt has to be below 43 percent at this moment.

Looking at that in a more concrete way, it breaks down like this if you make $50,000 annually:

– Your monthly income: $4,166.67
– FHA housing debt allowed: $1,291.67
– FHA total debt allowed (includes housing) : $1,791.67
– Conventional debt allowance: $1,875

It might not seem like a big difference overall, but the FHA restricts your mortgage to about a third of your income, even though in some markets that’s a difficult, if not impossible, house to find. Your conventional loan doesn’t discriminate, so if you have no credit card debt, you might be able to buy more house.

But that’s not to say that the FHA loan is a bad mortgage. It’s a really decent one, it just has a lot of rules designed to ensure you succeed at homeownership.

The FHA Downpayment Conundrum

FHA mortgages maintain one of the lowest down payment requirements of any mainstream mortgage offering. At just 3.5 percent, this financing type makes it easy to get into a home. That $200,000 house you’ve got your eye on? You just need $7k for a down payment (closing costs are separate)! That’s $3k less than the conventional loan can offer.

However, there’s a pretty big catch with that low down payment. The mortgage insurance that makes it possible for you to put down such a small amount of money is going to stick with you for the life of the loan. That’s the case, in fact, unless you’ve scraped together at least 10 percent of the sales price for a down payment.

Theoretically, you could refinance your low down payment FHA loan when you’ve paid down about 20 percent of the total value to shake the mortgage insurance, but there are no guarantees that you’ll end up in a better place. Rising interest rates, additional costs to close a new loan and even a new appraisal can eat into those cost-savings.

Some lenders offer a streamline refinance, which can save you a bundle when you’re ready to refinance the note you already have. Check with yours to see if the mortgage you’re signing will be eligible. You have some options, let’s make sure you’re taking advantage of them.

Oh, That Thing About Student Loans…

FHA is picky about your debt, that may have been mentioned. One thing that it is almost cruelly strict on is student loan debt. Unlike Fannie Mae, which only figures your actual payment into your debt-to-income ratio, FHA uses a formula that often ends up in a rejection for otherwise really well-qualified borrowers.

As of the writing of this article, FHA figures your monthly payment as one percent of your debt. Say, for example, you have $68,000 in student loan debt because you triple majored in everything, but you happen to be working in a field that won’t support a payment anywhere near what that debt requires to be repaid. Your federal student loan is enrolled in an Income Based Repayment program, with a payment of under $20 a month.

A conventional loan would verify that $20 and that would be all that would go into your DTI from your student loans. FHA, on the other hand, would add $680 to their calculation. Which, considering you’re on an IBR, will almost certainly make it impossible for you to qualify for anything.

TL;DR: FHA Ups and Downs

FHA has some nice features:

– Great for people with lower credit scores or small credit blemishes
– Allows for a smaller downpayment vs. other mortgages
– As a federally regulated loan, closing costs are often lower

But it also holds many buyers back with:

– Low DTI allowances
– High student loan payment calculations
– Lifetime mortgage insurance

If your overall debt is low, you don’t have a student loan to deal with (or you have a very small one) and you’re planning on selling in five or seven years, FHA loans can absolutely get you into the real estate market faster with less money out of pocket. The extra time spent putting monthly payments toward equity rather than rent can help you become more financially secure earlier.

Contact the experts on The Mary Gilbert Group for all your Real Estate needs! 541.371.5500 or [email protected] 

By: Homekeepr

Ready to Buy a House in Roseburg, OR?

by Mary Gilbert

Buying a home is likely the largest investment you will ever make.  There is plenty of preparation before you start house-hunting, so make the process as smooth as possible with this guide to buying a home. 

 

  • - We can’t say it enough:  mind your credit!  Unless you have the funds to pay for a house in cash, then you need to keep an eye on your credit. Get a report from all three credit reporting agencies from the Annual Credit Report website.
  •  
  • - Know what you can afford.  Make a budget and stick to it, recording everything on paper or using budgeting software.  Once you see where your money is going, it’s easier to cut some unnecessary things to put towards your down payment. 
  •  
  • That said, start saving now, not only for your down payment, but any other expenses associated with a home purchase:  inspections, closing costs, and taxes are a few to expect.  
  •  
  • Once you are close to having all of your down payment, start shopping for the best mortgages, and get pre-approved.  Being pre-qualified is great, but it’s not much help if you’re not approved for the loan. 
  •  
  • Be ready to compromise on certain home aspects:  square footage, having to make minor repairs, or even living on a busy street.  If the price is right, the house fits your needs and wants, then put the it on your possibilities list. 
  •  
  • Just because you’re approved for a certain home loan amount doesn’t mean you have to max that budget.  You need as much leeway in your finances for emergencies and unexpected costs. 
  •  
  • Prepare yourself for possible let-downs:  some perfect-for-you homes are also perfect for others who are on the search for a new house.  If there are several offers on a house, you may have to walk away from it and keep hunting. 
  •  
  • Don’t go through it alone!  Find a Realtor that you trust and like.  These real estate professionals are your ultimate guide through the home-buying process, and will make it so much easier for you.   

 

The house-buying process for most Americans takes a bit longer than what we see on the home-buying television shows. It takes planning and patience to find what you need and want.  So, do your “home” work, and you’ll soon be on your way to being homeowners! 

 

Contact the experts on The Mary Gilbert Group for all your Real Estate needs! 541.371.5500 or [email protected] 

 

Photo credit: atlanticbay.com

What If I Wait Until Next Year to Buy a Home?

by Mary Gilbert

We recently shared that national home prices have increased by 6.7% year-over-year. Over that same time period, interest rates have remained historically low which has allowed many buyers to enter the market.

As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.

The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Index Reporthome prices will appreciate by 5.2% over the next 12 months.

What Does This Mean as a Buyer?

If home prices appreciate by 5.2% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

Bottom Line

If buying a home is in your plan for this year, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.

Let’s get together and find your new home! 541.371.5500 or [email protected]

By: KCM Crew

House Hunting in One Day: 6 Tips for Maximizing Your Time

by Mary Gilbert

In the ideal home-buying scenario, attending open houses and pinpointing the perfect place is a breeze. But in a seller's market, finding a home is no small feat, which is why it's important to make the most of the time you spend touring houses. Since most open houses happen on the weekend, you'll need to do some prep work to manage your time wisely, so you don't waste the better parts of your Saturdays and Sundays. We’ve got you covered with these tips to help you make your home search as productive as it can be.

1. Get pre-approved for a mortgage

Do not start touring houses before you are pre-approved for a mortgage. Not only will this crystallize exactly the price range you should be considering, but it will solidify your status as a serious buyer when the time eventually comes to make an offer, says Spencer Chambers, real estate expert and owner of the Chambers Organization in Newport Beach, CA.

2. Clarify which amenities matter most

You won't be able to zero in on the right property if your wish list is a mile long or too vague. “Make a list of your absolute necessities and another of your wants; together, these will become your guide on which houses you'll look at, based on the boxes they check,” Chambers says.

Beyond the physical house, brainstorm other variables that will help you narrow down the neighborhood: school district, walkability, proximity to downtown, etc. “Think about what you like to do on the weekend and what you need access to,” says Wendy Hooper with Coast Realty Services in Newport Beach, CA. Do you love dining out? Is a thriving music scene important? Do you need to live in a top-notch school district? “All of these factors help narrow communities quickly," Hooper says.

Finally, if you’ll be commuting, check out typical drive times during the hours you'll be on the road, using Google Maps or Waze. “Just because a property is near a highway doesn’t mean you’ll have smooth sailing if the highway is clogged with daily bumper-to-bumper traffic,” Taylor notes.

3. Find a savvy real estate agent

Once you are clear on your parameters, it’s time to start touring these homes. You'll really want a real estate agent who knows the area. One way to find one is to start perusing listings in your preferred location and see what names keep popping up; they are likely to be the local experts. In many instances, they will be familiar with the homes for sale, and they may even catch wind of homes that are about to hit the market, so you can have a first look.

The goal is for your real estate agent to help you whittle down the list of homes you like online to a handful you'll tour in person during the weekend.

4. Plan your route wisely

Once you’ve settled on the houses you'll tour that day, have your agent create an itinerary of the most efficient route to see them. Grouping properties by neighborhood helps clients get their bearings on relative distances and a feel for what each neighborhood offers, says real estate agent Jake Tasharski with Center Coast Realty in Chicago.

However, if you’re short on time, Taylor recommends prioritizing by preference to make sure you’re able to see your top prospects. Or front-load your schedule with the newest listings, since those are the hottest homes that other buyers are eager to tour.

5. Take notes (and photos) as you go

When you are touring many houses in one day, they are naturally going to blend together. To keep them all straight, take plenty of photos—at least one of each room—and take notes of anything you notice, both positive and negative. Spencer also recommends giving each house a nickname, something that stands out to you, so that you can easily remember it.

Remember, this is the time to be judgy. Tasharski encourages clients to eliminate homes as they go by comparing each current home to the previous showing, and to their favorite home so far. “Seeing so many properties in a short amount of time can get overwhelming, so if my client knows a home they just saw isn't ‘the one,’ we throw that listing sheet away, so it's out of sight and out of mind.”

6. Block out the last half of the afternoon to revisit your top choices

If at all possible, leave the final hour to revisit your favorite properties. Still have extra time? Get to know the neighborhood. enjoy a snack or cocktail in a local bistro, and soak up your new neighborhood vibe, Taylor suggests. You’ve earned it.

Let's get together and find your dream home! 541.371.5500 or [email protected] 

By: Realtor.com, Cathie Ericson

US Housing Market Still In ‘Buy Territory’!

by Mary Gilbert

According to the Beracha, Hardin & Johnson Buy vs. Rent (BH&J) Index, the U.S. housing market has continued to move deeper into buy territory, supporting the belief that housing markets across the country remain a sound investment.

The BH&J Index is a quarterly report that attempts to answer the question:

In today’s housing market, is it better to rent or buy a home?

The index examines the entire US housing market and then isolates 23 major cities for comparison. The researchers “measure the relationship between purchasing property and building wealth through a buildup in equity versus renting a comparable property and investing in a portfolio of stocks and bonds.” 

While 13 of the 23 metropolitan markets examined moved further into buy territory, markets like Dallas, Denver, and Houston are currently deep into rent territory. Due to a lack of inventory, the home prices in these areas have increased by 6.7%6.3%, and 5.3%  respectively from a year ago.

According to Eli Beracha, Ph.D., Co-Creator of the index, home prices will begin to return to more normal levels.

Our data indicates that prices are above their 40-year trend but not significantly so as they were in 2007. Rather than a crash, I anticipate slower growth in prices accompanied by longer marketing times for sellers and increasing inventories, which should bring prices back in conjunction with their 40-year trend.”

Bottom Line

The majority of the country is strongly in buy territory. Buying a home makes sense socially and financially, as rents are predicted to increase substantially in the next year. Protect yourself from rising rents by locking in your housing cost with a mortgage payment now. 

Let the expert's at the Mary Gilbert Group assist you with all your real estate needs! 541.371.5500  or [email protected] 

By: KCM Crew

According to data released by the Internal Revenue Service (IRS), Americans can expect an estimated average refund of $2,840 this year when filing their taxes. This is down slightly from the average refund of $2,895, last year.

Tax refunds are often thought of as ‘extra money’ that can be used toward larger goals; for anyone looking to buy a home in 2018, this can be a great jump start toward a down payment!

The map below shows the average tax refund Americans received last year by state. (The refunds received for the 2017 tax year should continue to reflect these numbers as the new tax code will go into effect for 2018 tax filings.)

It's Tax Season… Use Your Refund to Jump Start Your Down Payment Savings! | MyKCM

Many first-time buyers believe that a 20% down payment is required to qualify for a mortgage. Programs from the Federal Housing Authority, Freddie Mac, and Fannie Mae all allow for down payments as low as 3%, with Veterans Affairs Loans allowing many veterans to purchase a home with 0% down.

If you started your down payment savings with your tax refund check this year, how close would you be to a 3% down payment?

The map below shows what percentage of a 3% down payment is covered by the average tax refund by taking into account the median price of homes sold by state.

It's Tax Season… Use Your Refund to Jump Start Your Down Payment Savings! | MyKCM

The darker the blue, the closer your tax refund gets you to homeownership! For those in Alabama looking to purchase their first homes, their tax refund could potentially get them 69% closer to that dream!

Bottom Line

Saving for a down payment can seem like a daunting task. But the more you know about what’s required, the more prepared you can be to make the best decision for you and your family! This tax season, your refund could be your key to homeownership!

Start your home search today with The Mary Gilbert Group! 541.371.5500 or [email protected]

By: KCM Crew

For home buyers locked in a heated bidding war, there is one weapon that may help ensure victory: an escalation clause.

It’s an addendum to a real-estate contract, typically when the offer is made, in which a prospective buyer says, “I will pay X dollars for this house, but if another buyer submits a verifiable bid that’s higher, I will raise my offer in increments of Y dollars to a maximum price of Z.”

These clauses are particularly useful in a competitive real-estate market where homes typically get multiple bids. If a bidding war erupts on a home, the escalation clause will automatically raise the buyer’s offer on the house by the predetermined increment, up to the maximum amount the buyer authorizes. It eliminates the back and forth of offer and counteroffer and helps the buyer avoid paying too much for a house by getting caught up in the frenzy of a bidding war. But they can be risky for buyers who use them.

“A buyer can think of an escalation clause as a ‘have your cake and eat it, too’ clause,” says David Reiss, a Brooklyn Law School professor who specializes in real estate. “But in real estate, as with cake, it is hard to have it all.”

One concern is that the buyer is tipping his hand to the seller by using an escalation clause, Prof. Reiss says.

By indicating the maximum amount he will pay for the house, a buyer is revealing important information—that he’s willing to pay more. For example: Seller lists the house for $1 million. The buyer bids $950,000 with an escalation up to $975,000. The seller can counteroffer at $975,000, knowing that the buyer can both afford it at that price and is willing to pay it.

“Sellers get more money than they ever thought they would have,” says Carrie DeBuys, a real-estate agent with Realogics Sotheby’s Realty in Seattle. In her market, it isn’t uncommon for a seller to receive “10, 15 or 20 offers on a property.”

On the flip side, an escalation clause may not be in the seller’s best interest, explains Prof. Reiss.

Say a house is listed for $1 million, and there are three bidders. Buyer A offers $950,000. Buyer B offers $975,000 with an escalation clause that could go up to $1 million in $5,000 increments. Buyer C offers $980,000. In this scenario, the seller would get $985,000 from Buyer B after the initial offer escalates over Buyer C’s offer. But, had the seller not relied on the escalation clause and instead asked the bidders for their best and final offer, he might have sold the house for $1 million. “We know that the buyer was willing and able to go up that high,” Mr. Reiss says. “Thus, the seller is likely getting $15,000 less in the escalation-clause scenario.”

While escalation clauses are commonly seen in competitive markets like San Francisco and Seattle, they are less common at the top end of the market. “They’re not really happening at the ultrahigh end because the X amount—the increment—has got to be pretty significant,” says Billy Rose, president and co-founder of the Agency, a brokerage in Beverly Hills. “If you’re talking about a $15 million house, the X amount needs to be substantial enough to be material. A $2,000 increment is not going to make a difference.”

Escalation clause tips

Here are some things to consider if you’re thinking of using an escalation clause.

• Be aware of the mortgage. If an escalation clause is invoked, buyers may need additional cash on hand for a larger down payment. The escalated price can also affect the type of mortgages available to the buyer—as well as the appraisal, which may not match the escalated price.

• Feel out the seller first. “Some agents and sellers do not react favorably to escalation clauses because they think they are unfair,” says Michael Nourmand, president of Nourmand & Associates, a brokerage in Los Angeles. “You should know their position before blindly using this strategy.” Otherwise, the seller may not consider your offer.

• Get it in writing. Buyers should specify the type of documentation the seller must provide before the escalation clause kicks in. For example, the escalation clause could specify that the seller must provide a copy of the highest offer received.

Roseburg Properties Group541.371.5500 or [email protected]

By and photo credit: Realtor.com,  

Millionaire to Millennials: Don’t Rent a Home… Buy!

by Mary Gilbert

In a CNBC article, self-made millionaire David Bach explained that: The biggest mistake millennials are making is not buying their first home.” He goes on to say that, “If you want to build real financial security, real wealth for your lifetime, then you need to buy a home.

Bach went on to explain:

“Homeowners are worth 40 times more than renters. Now, that first home doesn’t need to be a dream home, it can be a very small home. You might literally have to buy a small studio apartment, but that’s how you get started.” 

Then he explains the secret in order to buy that home!

Don’t do a 30-year mortgage. You want to take that 30-year mortgage and instead pay it off early, do a 15-year mortgage. What happens if you do a 15-year mortgage? Well, one, you pay the mortgage off 15-years sooner, that means you’ll be able to retire in your fifties. Number two, you’ll save a fortune (on potentially hundreds of thousands of dollars in interest payments).”

What will it cost to pay your mortgage in fifteen years? He explains further:

“For fifteen years, you got to brownbag your lunch. Think about that! Brownbag your lunch literally for fifteen years. You can retire ten years sooner than your friends. You’ll have real wealth, because you bought a home – you’re not a renter. And you’ll be financially secure for life.”

Bottom Line

Whenever a well-respected millionaire gives investment advice, people usually clamor to hear it. This millionaire gave simple advice – if you don’t yet live in your own home, go buy one. 

Contact Roseburg Properties Group for all your home buying needs! 541.371.5500 or [email protected] 

By: KCM Crew

Who is David Bach?

Bach is a self-made millionaire who has written nine consecutive New York Times bestsellers. His book, “The Automatic Millionaire,” spent 31 weeks on the New York Times bestseller list. He is one of the only business authors in history to have four books simultaneously on the New York Times, Wall Street Journal, BusinessWeek and USA Today bestseller lists.

He has been a contributor to NBC’s Today Show, appearing more than 100 times, as well as a regular on ABC, CBS, Fox, CNBC, CNN, Yahoo, The View, and PBS. He has also been profiled in many major publications, including the New York Times, BusinessWeek, USA Today, People, Reader’s Digest, Time, Financial Times, Washington Post, the Wall Street Journal, Working Woman, Glamour, Family Circle, Redbook, Huffington Post, Business Insider, Investors’ Business Daily, and Forbes.

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Contact Information

Photo of Mary Gilbert Real Estate
Mary Gilbert
Keller Williams Realty Umpqua Valley
2365 NW Kline Street, Suite 201
Roseburg OR 97471
541-371-5500
Fax: 541-371-5501

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