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Cell: (248)736-6407

Jackie@JackieHawley.com

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Buying a Short Sale or Foreclosure Listing 

In today's real estate market, choosing the right agent is more important than ever. With the rapid changes in available mortgage programs, the large influx of foreclosed homes, short sales, houses assessed for more than they're selling for and a plethora of other factors, make choosing an experienced, knowledgeable, full time agent even more important than in the past.

Once you've made the decision to purchase a home (or investment property) the first two things you need to do is contact a loan officer and contact a full time, experienced real estate agent. It's a good idea to interview two or three professionals just like a seller would, then select one to work with exclusively.

When you work with multiple agents, none of them will work as hard for you as they would if they know they have your loyalty. Multiple agents will send you the same listings (or they should if they're using the same search criteria) so there's really no advantage to working with more than one agent. How much work (and time) can you expect a person to invest in your search when there's a good chance another agent will show the property to you?

There's more to finding a house for a client than plugging the search criteria in the MLS and emailing it to the buyer/client. The first time I show you houses I get a good idea of what you really like and dislike. If you want automatic MLS updates, I will be happy to do that for you, but I will also go through the updates myself and cull out the crap and only send you houses that suit your needs. I grew up in Lake Orion and have sold in the North Oakland and Lapeer areas for over 20 years and know the area well. After I get a good idea of what you do and don't like in a house I use that knowledge of the area and my experience to help you find the home that best suites your needs as well as considering the investment aspect of the purchase.

Both my associates, Marcia, Stacey and I look out for your best interest, educate you about the process, and we will work harder for you than any other agent will. By having three agents on our team, you won't be working with an agent who is always trying to "fit you in."

• Upon our first conversation I will question you thoroughly so I can start your first search. There's a good chance that search will change after I've shown you a few houses, but I need to get as much information from you as possible to make that search a thorough one. I would hate for you to buy a house and find out later that there was something you might like better that I never told you about.
• I will discuss agency with you which has been required in this area since 1994
• The first time either of us shows you houses we will show you a variety of homes in a variety of areas (such as different subdivisions or different lakes if you're a lakefront buyer) but that still meet your basic criteria
• After the first trip out to look at houses I will go back the the computer and alter your search criteria. We then look at EVERY listing that comes up, the additional photos the listing agent supplies, if the house is in Oakland County we look at aerial views, then pick out the houses we feel will best fit your needs
• Once you've found the house you want I will pull comps (comparable sales) and together we will put together an offer. Then the negotiations start.
• Once we've come to terms with the seller we schedule the home inspection (I can recommend a very good home inspector if you don't already have one).
• After the home inspection I will order the title work and get the pertinent information to your loan officer who will order an appraisal and convert your "pre-approval" into a mortgage commitment, then we proceed to closing (this typically takes approximately a month from the time our offer is accepted to close)

Below are just a few things that set the Jackie Hawley team apart from other agents as well as some myths or common misconceptions about purchasing real estate, and the facts. Please don't hesitate to call or email if you have any questions.

248-736-6407

Jackie@JackieHawley.com

• We are all experienced, full time Realtors who are knowledgeable about our market area
• We have a full time assistant who helps with the phones, paperwork, computer work, etc which frees us up to devote more time to you
• With out of the area buyers or transferees we will preview houses for you and take photos and/or video to send to you before you make that trip to Michigan. This will help you weed out some of the homes you wouldn't be interested in
• We advise you on the investment portion of your purchase. We point out potential repairs (neither of us are builders, but we've both seen literally thousands of homes and will probably see problems the typical buyers might overlook), we discuss re-saleability, WE WILL GIVE YOU OUR OPINION - it's not our goal to just hustle you into the first house you express interest in
• When we look at houses, we give you the full listing of each house along with the listing history, the public records sheet (which may show what the seller paid and how much the mortgage is) and if the house is in Oakland County we attach an aerial with the property lines outlined in red
• Most importantly we listen to your wants and needs and we look out for YOUR interests 100%  

Myth: The new taxes will be based on half the new sales price.

Fact: There are 2 assessments on your tax bill: your taxable value and the state equalized value (SEV). Upon transfer of ownership the SEV becomes the new taxable. That may be higher than half the sales price.

Myth: Sellers are coming down 20%, 30%, 40% and more.

Fact: In the Orion, Oxford, Clarkston area, sellers are coming down about 5 or 6% on average. It's your agent's job to help you determine what is a fair price to pay. Some sellers are coming down more than the average stated above, but some houses are selling for more than asking price.

Myth: Short sale means it will close fast.

Fact: Short sale is when the seller owes more on the house than he will be able to sell it for so he is asking the bank to take a reduction on the payoff. Sometimes this can be accomplished in a matter of days but often times it can take anywhere from 3-6 months to hear an answer from the lien holders. And at that point they can outtight reject the short sale or counter.

Myth: Foreclosures are the best deals.

Fact: Sometimes they are better deals. Some are beat up and some are pristine. But the foreclosures have had a big influence on setting prices that have forced regular home sellers to lower their prices in order to compete with the foreclosures.

It was the best of times (when your house was assessed). It was the worst of times (now)…it was the epoch of belief, it was the epoch of incredulity… it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us…

Two houses in Oakland County Michigan- both priced the same. Both in the same township with the same tax base. The difference- The tax amount.To the tune of a tad over $2800/year or $235/month. This is not chump change and it is very important.

When you get pre-approved for a $300,000 sale price, the loan officer had to use some number for taxes. In reality, when you get pre-approved for a mortgage, you’re really getting pre-approvedfor a maximum house payment amount.

In the example above, the difference in taxes is because of the assessments and the fact that one of the houses is in the village and has a village tax. Both are on the same lake. So- how does that $2800 additional annual tax affect your buying power?

To make the math easy, I’m going to assume an interest rate of 4 3/8%. At a 4 3/8 per cent interest rate $5=$1000 of sale price. Or annual tax. A difference of $235 in house payment equalsabout $47,000 in purchase price. OR- house A with higher taxes would need to sell for $47,000 less than house B in order to have the same monthly house payment. Or- you can pay $300,000 for house B and have the same house payment as you would if you paid $253,000 for house A.

When I show you houses, attached to the MLS sheet is the public record that gives recent tax information and an assessment history. This will also help you determine what your new taxes will be. So when we’re looking at things like size, location, price, we also need to pay attention to the property taxes.

Jackie Hawley
Cell: (248) 736-6407
Jackie@JackieHawley.com  

Right now in Oakland and Lapeer County Michigan many houses are assessed higher than their true market value. Many home buyers are under the false assumption that they will only be stuck with that tax for the first year. That the new assessment will be half the sale price. This is not correct!

When I show you houses, one of the sheets attached to the listing is the public record report for the house that is available through our MLS. This public record sheet (or PRD) will give the taxable value and the state equalized value as well as the annual tax amount.

The taxable value is the number used to calculate your taxes. The taxable value times the millage rate equals your annual tax bill.  Upon transfer of deed (sale) the SEV will become the new taxable. In this market there’s a good chance the SEV will be higher than half the sale price.

I showed a house the other evening that is listed for $278K. The SEV and the taxable are both $163,610. Multiply that by 2 and you will be taxed like your house is worth $327,220. That is going to make a difference on your monthly payment.

This isn’t to say your assessment won’t drop next year- state law states that the assessed value is to be one half of the assessor’s estimate of market value of your property, and that the taxable value has to be less than or equal to the assessed value. And once ownership is transferred, and a new taxable in place, that taxable value is capped at 5% or the rate of inflation- whichever is less.

Many townships are dropping assessments across the board. The house in the above example was assessed at $198,670 in 2006 and has dropped each year since. You may also fight your assessment through your township and appeal to the state if you are not satisfied with the results.

For the purpose of determining what your costs will be when purchasing a home, you should figure the worse case scenario and figure your new payments based on a tax amount that uses the SEV plus 5%. When your taxes end up lower- treat yourself! Or put it against the principle of your house.

Jackie Hawley
Cell: (248) 736-6407
Jackie@JackieHawley.com