Monday, September 24, 2012

FHA MIP Release

FHA loans require mortgage insurance premium to cover a possible loss to the lender if the property has to be foreclosed and sold. The premium is substantial and eliminating the MIP would reduce the payment considerably.

The MIP must remain in effect for five years but after that, when the balance is 78% of the original purchase price, FHA will release the requirement and your monthly payment will go down. Since amortization is affected by interest rates, the normal time to reach this 78% point could be from 9 to 12 years at today's interest rates.

In the example below, the MIP would be released in 9 years 6 months with normal payments. An extra $100 a month would allow the borrower to reach the release point in 7 years 1 month. To reach the release point in the minimum five years, the borrower would have to make an extra $268.04 per month principal contribution.

Releasing the MIP in this example would save the borrower $177.67 per month. The borrower would also save interest, build equity and shorten the term of their mortgage. Once the MIP is released, the borrower could continue the same payment schedule to further accelerate the debt reduction.

To make some projections on your mortgage, click here.

Monday, September 17, 2012

Home Safety & Security Tips

house-padlock.pngA quick once-over of the items on this list may improve the safety and security of your home and could protect your family and friends. It is important to periodically pay attention to these things because things change over time.


  • Does each exterior door have a deadbolt?
  • Does the lock on each window work?
  • Have you added pins or clips to your windows for additional security?
  • Do you have dowels or broom sticks in the track of windows and sliding glass doors?
  • Do you have security company labels or signs displayed prominently?
  • Do you have an alarm system? Is the system monitored?
  • Do you have a dog that barks when strangers approach the home?
  • Are emergency numbers posted near the telephones?


  • Do you have smoke detectors near all sleeping areas?
  • Do you check the batteries monthly and change them annually?
  • Do you have two carbon monoxide detectors?
  • Do you have an escape ladder for upper floors?
  • Do you have fire extinguishers near exits and in the kitchen?
  • Do you have an emergency escape plan and is the family familiar with it?
  • Are any outlets or switches warm to the touch?
  • Are kitchen ventilation systems working properly?
  • Is the dryer ventilated to the outside and is the exhaust free of lint?
  • Is the furnace cleaned and serviced yearly?
  • Is the space around the hot water heater clear of combustible materials?


  • Are all electrical and phone cords out of the flow of traffic?
  • Are rugs and runners slip resistant?
  • Is your step-stool sturdy and in good condition?
  • Are stairs clear of objects that could cause a fall?
  • Are all entrance ways, exits, halls and walks well lighted?
  • Do bath tubs and showers have non-skid strips or suction mats in them?


  • Do you keep drugs and medicines out of reach and sight of small children?
  • Are interior doors designed so small children cannot lock themselves in rooms?
  • Are pool and play areas fenced to keep small children in and uninvited guests out?
  • Are firearms kept out of reach and sight of children?
  • Is a well-stocked first aid kit available for emergencies?
  • Is there one member of your family trained in first aid, CPR and the Heimlich maneuver?

Monday, September 10, 2012

Rates Are Down But It Costs More?

The latest Housing Affordability Index from the National Association of REALTORS® shows an interesting trend taking place this year that needs buyers' attention. Most people know that the mortgage rates are still at incredibly low rates but don't feel there is much sense of urgency.

This report shows that mortgage rates have fallen from 4.37% in January to 3.81% for June. However, the report shows that the payment as a percentage of income has gone from 12.1% to 13.9% which simply means that buyers have to spend more of their income on a home.

The reason is that the median price of homes nationally has gone from $154,600 in January to $190,100 in June which is a 23% increase. The two major components of housing affordability are the price of the homes and the mortgage rates a buyer must pay.

Even if one of those components is going down, the other could have a significant affect as is shown in this year's trend in housing affordability. In the past few weeks, the effects of which are not show in this report, mortgage rates have been moving up.

Home buyers and investors who have been taking a wait and see approach need to make a decision if now is the time to act.

Thursday, September 6, 2012

Remodeling and Updating Pearland Real Estate

Renovate.  Remodel.  Enhance.  Update.

These are the key words that we tell our home sellers these days.  Unfortunately, what was "hot" 10 years ago -- brass light fixtures and doorknobs, white porcelain sinks, Corian countertops, white appliances -- are not "hot" today.  Today's buyer is looking for updates like granite, brushed nickel finishes on fixtures, stainless steel appliances and sinks (not to mention hardwood floors).

In fact, it has become difficult -- if not impossible -- to sell the 10-year-old homes without these updates!  These are the homes that just "sit" on the market.

So what to do?  The new buzz is "Renovation Financing," with conventional conforming and FHA 203(k) lending.  This isn't a new concept, on the contrary -- this type of financing has been around for years.  However, it has been typically cumbersome to use, and consequently, no one used it.

Now, however, lenders are developing and devoting entire departments at their banks for this type of lending ONLY!  In fact, one lender has committed to making 10% of their entire loan portfolio in renovation financing!

How does it work?  A buyer finds a wonderful home in a great location, but it has all those things I mentioned above that no one wants.  So, an approved contractor and the buyer (along with a coordinator/consultant for the lender) choose the work to be done, the colors to install, and voila!  The bank makes one loan to the buyer for the purchase AND the remodeling -- and the payments won't start for up to 6 months after closing, to allow time for the remodeling!  So . . . if your lease won't be up for a few months, get started now!

Get the home you want -- where you want it -- and how you want it!  For specifics, call me.  Sam Ferreri.  832-200-5656.  With my extensive home remodeling experience and my appraisal experience, I can help you through the process.

And now . . . I'm practicing what I preach!  I've started remodeling my own home (built in 2000) and my office building (built in 2002).  Yes, time for updates, renovations, and remodeling -- for my customers, clients, agents, staff, and myself.

Tuesday, September 4, 2012

Handling the Eyesore

It can be unsightly and upsetting when a home in a neighborhood isn't being maintained like the others. It might be an overgrown yard, a fence in need of repair, paint peeling on the home or even a car parked in front of the home that hasn't moved in weeks.

I believe most people want to be good neighbors and may be willing to correct the issue once it is brought to their attention. In some cases, they may not agree with the same urgency and it might be necessary to seek other remedies.

The most expedient solution may be to contact the responsible person and describe your perception of the problem. An owner-occupant may be sympathetic to the neighbors and more than willing to correct the issue.

However, if you suspect that it is a rental property, check with the county tax records to identify the owner. They may be unaware of the situation and would actually welcome the "heads-up" to protect their investment.

The next step might be to notify the homeowner's association if there is one. The covenants or bylaws will specify how properties must be maintained and the association can enforce them.

The final step would be to notify the city for a possible code violation. Most cities have a separate code and neighborhood services division and some cities have 311 for non-emergency assistance.

Monday, September 3, 2012

Alive and "Kicking it" in Pearland!

Sam Needs a Kidney, but still Kicking it in Pearland!  (No, not the bucket!)

It seems that with all the blogging and marketing for a kidney donor, many people have gotten the idea that I'm near death's door.  Although I don't fear death, I don't welcome it either.......but I'm alive and kicking it here in Pearland!

I know that many of my competitors secretly wish it was doomsday for me . . . but that's just not the case.  In fact, I'm developing new marketing plans for my team and my company right now.  And here's a preview of what's to come:

  • New agent development program for new and existing agents at RE/MAX Top Realty (this is where we train agents how to be extraordinarily successful as Realtors in the present and future markets)
  • New lead generation and management platform designed to increase agents' production at RE/MAX Top Realty (with support built-in to help them develop, capture, and convert far more leads)
  • New office design (our building is nearly 10 years old, so we're updating the look and the technology to help agents succeed at never-before levels)
  • New, younger office development and management team (Rachel and I are still here, but we're training the next gen -- Katie and Travis -- to assist with the support and skill building systems that we're implementing)
We think the market will improve over the next 5-10 years, so we're planning to continue to "kick it" into the next millenium!  Want to learn more?  Call me at 832-200-5656.

If you're a Realtor, and you're dissatisfied with the high cost and low production that you're experiencing by associating with your current broker, you should consider the advantages of RE/MAX Top Realty, and how surprisingly low our cost of doing business is (as compared to other national brands).  Yes, it's less!  I know that you've always heard of "high fees at RE/MAX," but that's not true.  We've kept our costs down, we own our building, we have little to no debt.  Our cost of doing business is better . . . and our market share exceeds all the others!  Find out how Top Agents at RE/MAX Top Realty make more money.