Real Estate Weekly December 24, 2021

RE-Weekly REAL ESTATE IN SKAGIT, ISLAND AND WHATCOM COUNTIES

INSIDE

This Issue

LOW APPRAISAL PREP PLAN -WHAT YOU CAN DO IF THE HOME YOU WANT TO BUY APPRAISES FOR LOWER-THANEXPECTED PAGE 5

SEE PAGE 3 FOR MORE

13589 CLAYTON LANE, ANACORTES

$1,000,000

WiNdERmERE/SKAGiT VALLEY ELiZABETH miLLER

RealEstate weekly

A supplement to the Skagit Valley Herald and the Anacortes American

360-420-3607

CLASSIFIEDS PAGE 7 DEC 24-30, 2021 170974-1

FEATURE HOME:

WHICH PRICE IS RIGHT? PAGE 7

TABLE OF CONTENTS Low Appraisal Prep Plan What you can do if the home you want to buy appraises for lower-than-expected ..................P5 Q&A Ask Our Broker ......................................................................P6

Which Price Is Right? ...................................................P7

INSIDE PAGE

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RE-Weekly

December 24, 2021

STAT Real Estate Stat

12%

From one year ago, the inventory of unsold homes in October 2021 decreased 12% to 1.25 million – equivalent to 2.4 months of the monthly sales pace.

Source: National Association of Realtors

NORTH PUGET SOUND ASSOCIATION of REALTORS® 525 East College Way, Suite J

Mount Vernon, WA 98273

Tel. (360) 416-4902

www.npsar.realtor

Mission Statement: The Nor th Puget Sound Association of Realtor s advocates for Realtors and their clients, and promotes the protection of property rights.

December 24, 2021

RE-Weekly

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Now could be the time to sell a new home and earn a slice of the real estate pie.

Record-low interest rates is renewing interest in the housing market for many people.

“When sellers are interviewing real estate agents to market their homes, their primary focus is usually on the advertising that the agent will offer them,” says Jessica Goodbody of Weichert Realtors.

Let us help you meet your marketing goals by advertising your listings in Real Estate Weekly.

Call 360.416.2180 Today!

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a a t p r p p

i s o S m

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December 24, 2021

you can ask the appraisal management company for what is called a ‘reconsideration of value,’ so long as your request is based on factual errors and not opinion,” Taylor notes. “Years ago, we were selling a home and the lender’s appraiser was not familiar with the neighborhood. As a result, they ignored comparable sales that more closely resembled the home we were selling. Our agent contacted the appraisal management company and explained why their appraiser was incorrect and asked for a different appraiser to reappraise the property. After they did so, the appraisal came in at the agreed-upon purchase price.”

As a last resort, you can abandon ship.

“If you have a financing contingency in your contract that protects you in the event of a low appraisal, and you have met all of its terms and conditions, you can walk away from the deal and get your earnest money back,” says David North, broker and owner of Redmond, Washington-based Realtrua.

While there’s nothing a Builders, explains that increase the value of the versus the appraised value seller to drop the price to

By Erik J. Martin of the home. A lender may make up some or all of the buyer can do to prevent a t’s a buyer’s worst night- today’s competitive market- home.” low appraisal, it’s important And that’s a recipe for a specify, for example, that appraisal shortfall. mare: the home they’ve place has paved the way for to consult closely with your a significant increase in low low appraisal that threatens they will loan a maximum “When faced with a low been salivating over agent or attorney to careappraisals. to destroy the deal entirely. of 95% of a home’s apappraisal, I recommend to and made an offer on gets fully determine if the home With bidding wars preva- praised value. That means my buyer clients that they appraised but is determined “Many homes are selling at record high valuations lent today, if a home shop- the buyer must provide should try to negotiate the you want to make an offer to be worth less than the per overbids on a property, the remaining 5% of the deal to move forward,” sug- on is properly valued. price agreed upon. That’s a because of competition— not intrinsic valuations. they may find themselves purchase,” Taylor adds. gests Jason Gelios, a Realtor “Try to ensure that the result that typically means house you are going to buy Th e latest increase in home not just paying more but When the appraised value in Southeast Michigan. pain for the prospective values is the direct result impacting their loan’s alis lower than the agreed-up- “Oftentimes, both the buyer is being sold at the right purchaser. of a strong seller’s market,” lowed maximum loan-toon purchase price, the buyer and seller will split the dif- market price that can be “When appraisals come supported by sales of comhe says. “There are simply value ratio. in low, it can sabotage the has a few options. ference of what the home too many people looking “Most loans are based sale,” notes Robert Taylor, The first is to come up should have appraised for.” parable properties in your area,” recommends Gento buy in a market where owner of The Real Estate on a loan-to-value of the with the difference in Alternatively, you can nady Litvin, an attorney at there aren’t enough listings. home being purchased, Solutions Guy in Sacracash, making up the down request a new or corrected mento.

As a result, sellers have been with the loan-to-value often payment shortfall out-ofappraisal from your lender. Moshes Law in New York San Diego-based Than able to increase their prices expressed as a percentage pocket.

“If you believe an appraisal City.

Merrill, CEO of Fortunewithout having to actually of the loan being obtained The second is to ask the is substantially incorrect,

LowWhatAppraisal Prep Plan you can do if the home you want to buy appraises for lower-than-expected

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December 24, 2021

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How Often Are Mortgage Applications Turned Down?

Question:

We’ve begun to look for mortgage financing before we go hunting for a first house. We want to see how much we can afford. As we speak with mortgage lenders, we get the feeling that the application process involves a lot of paperwork and a pretty good chance for rejection. How often are mortgage applications turned down?

Answer:

Mortgage loans are probably the most money you will ever borrow, six-figure debts that can be outstanding for as long as several decades.

You can bet that lenders are not going to hand out checks without carefully reviewing borrower credentials and qualifications. This is not only common sense, it’s the law: lenders cannot make residential mortgages without verifying that the borrower can repay the loan.

The process may look intimidating, but with better technologies, it’s likely to be easier to get a mortgage today than at any time in the past.

For instance, with your permission, lenders can

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get tax transcripts from the IRS to verify income.

Ditto with bank accounts. In some cases, you can get a desktop valuation rather than an in-person appraisal.

But, while the process has become much easier, a small percentage of all applications are declined.

In 2020, according to the National Association of Realtors (NAR), 6% of first-time buyer applications were rejected, versus 4% for repeat borrowers.

Why the rejections? Lenders decline applications for a variety of reasons, but according to NAR, there are three most common reasons for rejection.

Debt-to-income ratio (35%). A big affordability test concerns required monthly debt payments. If monthly payments are too high relative to gross income, then lenders are likely to pass on the loan. While it’s possible to get financing with a higher debt-to-income ratio (DTI), lenders will be much happier with DTIs below 43%.

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Q&A

ASK OUR BROKER

By Peter G. Miller

Low credit scores (24%). Different mortgage programs have different credit score requirements.

Check your credit reports at AnnualCreditReport. com to find any factual errors or out-of-date items.

If you find a problem, contact the credit reporting agency—Experian, Equifax, or TransUnion—to see if the item can be removed.

Income verification issues (14%). Remember the “ability to repay” rule above? Lenders must be sure you have the income you claim and that it’s likely to continue. The good news is that in some cases, it may be possible to “gross-up” income.

For instance, if you take depreciation, lenders may use it to enlarge your qualifying income.

For details and specifics, speak with local lenders and get pre-approved before you go house hunting. And remember, the odds of application success are very much in your favor.

Email your real estate questions to Mr. Miller at peter@ctwfeatures.com.

December 24, 2021

Which Price Is Right?

By Marilyn Kennedy Melia

What’s a diligent shopper who wants to astutely gather all relevant information before making an ofach buyer has his list of priorities that he fer on a home to make of these discrepancies? looks for in a home, whether it’s an ample Nothing at all, say real estate agents, who advise kitchen or a prime location. But, there’s one disregarding the estimates, since the information feature every home shopper cares about: the price they’re based on may not accurately reflect the contag. dition and facts of a home.

So it may seem a bit odd that on the sites that Still, given that cost is so paramount to home compile MLS home sale listings around the country, shoppers, a different price can be perplexing.

Zillow and Redfin, that the site’s estimate of what Most buyers are pretty astute about current mara home is worth is displayed—in addition to the ket values, says Matthew Martinez of Diamond Real more prominently placed list price.

Estate Group, Napa Valley region, CA. But “when And, that estimated price, known as either a Zil- the estimate is higher than the list price, a buyer can low “Zestimate” or “Redfin Estimate,” might not be think that “a website of some authority is telling under or over the stated list price. them the house is listed below what the value is, and

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December 24, 2021

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then they see it as a ‘good deal.’”

Conversely, lower estimates than the list signal could signal an over-priced property.

To avoid confusion, many MLS sites allow agents to “de-select” the automated valuation when the listing is sent to Redfin or Zillow.

Spokesmen for both sites state that estimates are no substitute for actual values determined by a professional appraiser. The estimates are determined by information on a home available through public records and the information might not be accurate.

Both Zillow and Redfin allow owners to edit the facts on their homes and submit current and accurate information.

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Located just outside the Mount Vernon City limits, this wooded 1 acre plus lot could be a building site for a stick built, modular, or manufactured home, with plenty of room. Tract has been surveyed (LeGro and Associates) and wetlands have been delineated (Oscar Graham and Pat Bunting).

Power and PUD water are available at the street.

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$600,000

Prime commercial property with utilities in street, including P.U.D. water, Puget Sound Energy electricity; Cascade Natural Gas, fiber optics; cable; and sewer.

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20787 BuLSoN Rd, StaNwood

$350,000

Beautiful wooded 4.98 acres situated on south side of Snohomish County/Skagit County line. Power is in street. Solar power is also possible. Adjacent property to the east of Subject Property is fenced, open field. Zoning allows for one building site. Stanwood-Camano School District; and just ten minutes to I-5. Great country living yet Danya Wolf convenient for commuting. MLS# 1841822 (360) 708-8294

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$850,000 After 60+ yrs this Big Lake prime property on the sunny side of the lake can now be yours. Approx. 80 ft of no-bank water front just minutes away from a nine-hole golf course. Property features a pier connected to a floating dock perfect for mooring your boat & watercraft. The approx. 4,500 SF of property bisected by N. West View Rd has an access road and additional possibilities for your needs. Besides the 2 bed 1 bath manuf. home the lot has a detached 750 SF garage/shop, out buildings and RV parking. And the large Russ Lanker covered deck is perfect for watching eagles, seasonal waterfowl & spectacular (360) 708-1117 sunsets! MLS# 1848508

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700 N Reed St, #40 SedRo wooLLey

Patrica Box Buyers Agent

(360) 424-0300

$135,000

Beautifully remodeled 1995 Nashua 52 x 28 doublewide manufactured home: 1350 square feet offers amazing kitchen including range, refrigerator, and dishwasher; a multitude of beautiful cabinets; pantry; and lots of counter space; formal dining room; spaciouslivingroom;threebedroomsand2fullbaths.Mastersuiteofferswalkincloset; master bath offers double sinks and tub for relaxing plus separate shower. Separate utility room. Nice decking; generous sized yard withstoragebuilding.Greenbelttoprotectfishandwildlifeadjacent Danya Wolf tothesouthoflot.MLS#1849202 (360) 708-8294 17180 MeMoRiaL Hwy MouNt VeRNoN $415,000

6.98 acre tract zoned Rural Intermediate. Level acreage with great road access both from Memorial Highway and from Avon Allen Road. Stop light and curbs at the intersection.

Special Use Permit potential. The Animal Hospital and an espresso stand is across the road to the west.

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Danya Wolf Designated Broker/ Owner (360) 708-8294

3780 E. College Way, Mount Vernon

www.skagittraditionrealty.com 171207-1

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