Seattle homes for sale

Seattle Real Estate Blog

Local real estate news in the Greater Seattle market: Home prices and trends in Seattle, on the Eastside, and across the Puget Sound region. Written by , Managing Broker with Coldwell Banker Danforth and State Director for Washington REALTORS.

Receive automatic email updates from the blog:

Enter your email address: 

April 22, 2015

836 2nd Ave #104, Kirkland, WA 98033 - For Sale Kirkland Condo

Price: $570,000             Ref: 775180
Address: 836  2nd  Ave  #104,  Kirkland,  WA  98033

 

Kirkland Area with...
2 Bedroom and 2.00 Bathroom
View: Territorial
Unit Features: Alarm System,Balcony/Deck/Patio,End Unit,Ground Floor,Insulated Windows,Master Bath,Walk-in Closet
Dishwasher,Garbage Disposal,Microwave,Range/Oven,Refrigerator
Ceramic Tile,Hardwood
Appliance Hookup: Cooking-Electric,Cooking-Gas,Washer
1 Fireplace
Common Features: Cable TV,Elevator,High Speed Int Avail,Lobby Entrance
No. of Park Spaces: 2
Homeowners Dues: $363.00
Dues Include: Garbage,Water/Sewer,,
Fabulous Kirkland Condo, 1516 sqft, 2bed + den. Spacious master suite with walk in closet. Double sided fireplace, new manufactured hardwood floors with radiant heat throughout. Newly renovated kitchen with SS appliances. Two private patios for relaxing and grilling or entertaining. Secure entrance with wheel chair access, storage area and garage with two parking spaces. Charming complex offering downtown Kirkland lifestyle!
For more information about this listing, make note of the Reference Number (775180)
and contact the following Agent or Office.

 

Email: 
Sam DeBord 
Web Page: http://SeattleHome.com
      Coldwell Banker Danforth

      Address: 155 NE 100th Street #120 - Seattle, WA 98125

      Phone: (206) 971-8800

    Fax: (206) 420-4367
Share This Post
April 9, 2015

Real Estate: What is a Due On Sale Clause?

due on sale clause

What is a Due On Sale Clause?

Real Estate Terms and Definitions:
Due On Sale Clause

Quick Definition: A “due on sale” clause in a mortgage provides that if the mortgagee sells, transfers, or in any way encumbers the property, the mortgagor has the right to implement the acceleration clause, making the balance of the obligation due.

In-Depth Explanation of Due On Sale Clause

Due On Sale clauses allow lenders to ensure that the property they finance will only be financed by borrowers whom they have approved.  They let lenders loan money to borrowers who are purchasing or refinancing real estate, but allow the lender to end the financing term if the borrower sells or transfers the ownership of that property.

Due on sale is a type of acceleration clause.  Acceleration clauses in financing are clauses that allow the lender to ask for full payment of the loan immediately.  If a certain condition occurs, that has been specified in the acceleration clause, the lender immediately has the right to ask for the borrower to pay the loan balance off in full.  The lender doesn't have to enforce the acceleration clause.  If lenders feel that the financing is still worthwhile, they may allow borrowers to keep making payments, but as soon as the acceleration clause has been triggered, the lender can, at any time, ask for the loan payoff.

A clause that's specifically written as a due on sale clause will allow the lender to accelerate the loan if the property is sold or the title is transferred to another person.  These clauses are used in almost all real estate lending today.  In the past, there were assumable mortgages that could be carried over through a sale.  A borrower could sell a home to a buyer, and the buyer would take on the seller's existing mortgage, continuing to make payments on it.  This reduced transaction and lending costs in some scenarios.  Assumable mortgages are rare today, unfortunately.

A mortgage with a due on sale clause usually has some exceptions.  Often, borrowers can transfer the property to their spouses in a divorce situation, or borrowers can transfer the property into their personal trust.  These should be verified in every lending situation before attempting the transfer, but they are common.  In most cases, though, transferring any ownership of your property to a person or entity which was not an owner at the time that financing was granted, will result in the due on sale clause being available to the lender.

How Due On Sale Clause could affect your real estate transaction:

Acceleration clauses and due on sale clauses will be present in any real estate financing.  A thorough conversation with a mortgage lender will educate the home buyer on the terms of the financing, including the due on sale clause.  This is a good time to review how the title to a home is transferred, how it is recorded, and how a recorded lien like a mortgage is also recorded against the property.  Borrowers will understand more clearly how a lender is notified that ownership has been sold or transferred, triggering a due on sale clause, when they understand the recording of documents.

While the acceleration clause won't have much relevance during the purchase of a home, it could have an effect on the time frame in which a borrower sells a home.  Carelessly transferring partial ownership of a property to family members or friends can put a borrower at risk of triggering an acceleration clause and having to sell the property to pay off the mortgage.  Real estate owners should never transfer real estate without proper guidance.  A real estate broker and real estate attorney are your best advisors when considering transferring or selling real property.

Want to know more about due on sale clause?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions.  Give us a call or send us an email and we can put you in touch with someone who can answer your due on sale clause questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post
April 8, 2015

Real Estate: What is a Down Payment?

down payment

What is a Down Payment?

Real Estate Terms and Definitions:
Down Payment

Quick Definition: The Down Payment is the amount of the purchase price that a buyer pays to the seller and that is not borrowed from a financial institution. It’s the portion of the sale price that is not included in the mortgage.

In-Depth Explanation of Down Payment

The down payment on a home purchase is a fairly straightforward concept. A home buyer will often get a loan, called a mortgage, to buy a home. The mortgage will usually only pay for part of the purchase price. Buyers have to come up with the rest of the purchase price with their own money. That portion of the purchase that comes from the buyers' money, not the bank's loan, is called the down payment.

Down payments come in many sizes. The down payment most often referred to is a 20 percent down payment. To get the best financing interest rates from a lender, many home buyers will put 20 percent of the purchase price down from their own funds, and borrow 80 percent of the purchase price in the form of a mortgage. There are also more attractive rates when the buyer can afford an even larger down payment, but the biggest benefits usually start at the 20 percent mark.

There are still great options for smaller down payments. Some borrowers may qualify for VA loans. That may allow them to finance 100 percent of the property, effectively having no down payment necessary. FHA loans, in some cases, will allow buyers to put just 3.5 percent down. There are also conventional loans that allow 5 percent, 10 percent, and 15 percent down payments. These kinds of programs open up home ownership to a much larger portion of the public.

Mortgages for borrowers who have down payments of less than 20 percent also often have some sort of private mortgage insurance (PMI). PMI is used to insure the lender against losses if the borrowers default on their payments. In the case that the home buyer stops making payments on the mortgage, and the down payment on the purchase was fairly small, the lender needs to know that it won't take a loss on the property if it has to foreclose on the property and resell it. PMI safeguards the lender in these situations. It may be an extra monthly fee added to the mortgage payment, or in the case of some government-backed loans, PMI can be an upfront fee at the point of financing.

There are other costs to consider besides just a down payment when calculating how much money a buyer needs to have available for buying a home. Buyers should plan on having their down payment funds, plus closing costs for the loan, property taxes, and homeowners' insurance all available for the purchase. Talking to a lender is the best way to be prepared for the overall costs of buying a home making sure your assets are enough to cover things like closing costs and PMI if they apply to your situation.

Down payment funds don't always have to come from the buyer directly. It's up to the lender, but some allow for down payments to come as a gift from a family member. The funds could also come from a local grant or government assistance program. Most funds need to be seasoned and sourced. That means they need to have been in a verifiable account for a significant amount of time so that the lender can see who the funds belong to, and where they came from.

How Down Payment could affect your real estate transaction:

Down payment is a consideration when looking at the price of home that buyers can purchase. The larger the down payment, the smaller the mortgage payment. For buyers who have limited monthly income, the total monthly payments they qualify for will be limited as well. Having a larger down payment will allow them to stretch the price of the property they can purchase.

While many buyers would like to put 20 percent down on a home, many with limited funds will put down less so that they can move up in price. The neighborhood, style, or size of home they need might give them reason to put a smaller amount down on a higher-priced home.

Home sellers will often look at the size of a down payment as an indicator of a home buyer's financial strength. If they receive multiple offers on their home, the strength of the buyers' financial status will be one of the factors considered in which offer to accept. An all-cash buyer, or a buyer with a very large down payment, may be viewed as a superior buyer who is more likely to close the transaction. For some sellers, that could be the deciding factor in choosing an offer. 

Securing your down payment funds and documenting their ownership and source over time is very important to keep your transaction running smoothly. A lender will often ask for multiple months' worth of bank or savings institution statements to document the ownership of the funds. Delaying this documentation, or transferring funds between different sources during the transaction, can cause delays in closing and even termination of sales contracts.

Working with a lender early in the buying process, and continuing to update the lender and quickly respond with documentation, is essential to a home buyer working efficiently through a transaction. Get the down payment, and any other closing costs, in a safe account which can be verified throughout the sale and quickly converted to a wire or cashier's check for the closing of the transaction.

Want to know more about down payment?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions. Give us a call or send us an email and we can put you in touch with someone who can answer your down payment questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post
April 6, 2015

Real Estate: What are Discount Points?

discount points

What are Discount Points?

Real Estate Terms and Definitions:
Discount Points

Quick Definition: Discount points are fees paid to buy down the interest rate when obtaining a loan. Each point is one percent of the total loan amount.

In-Depth Explanation of Discount Points

Discount points are money paid to a lender upfront by a borrower of a mortgage or other kind of loan to make the interest rate on the loan lower.  The borrower pays a point for a slightly lower interest rate, two points for an even lower rate, etc.

Discount points are calculated like other kinds of points on a loan (origination points, etc.).  A point is one percent of the total loan amount.  If a borrower is purchasing a home and needs a $100,000 loan, one point would be $1,000.

The borrower might be offered an interest rate of 5.0 percent on a 30 year mortgage.  There will be fees that are paid on top of that loan, including transaction fees and potentially origination points and/or discount points.  

The lender might offer the borrower a lower rate of 4.8 percent if the borrower pays 1 discount point ($1,000).  The borrower could pay two discount points ($2,000) and the lender would lower the rate to 4.6 percent.  Those discount points become part of the closing costs of the loan.

Discount points can be useful to a home buyer or borrower refinancing a mortgage.  You need to do a calculation based on the amount of time you intend to keep the loan to find out if discount points are right for you.  Since you're paying the points upfront, it will take some time for the lower mortgage payments, based upon a lower interest rate, to effectively "pay off" the points.  Most people need to stay in a home and carry a loan for a significant number of years for it to make financial sense to pay discount points.

How Discount Points could affect your real estate transaction:

Discount points could affect your ability to buy a home at a certain price point.  Since the interest rate on your loan will affect the monthly mortgage payment, your ability to afford a certain monthly payment can be dependent upon the interest rate.  

Depending on the borrower's situation, it may make sense to pay discount points, or do just the opposite.  The mortgage lender will look at the borrower's monthly expenses vs the monthly income.  The lender will calculate a debt-to-income ratio, and if the ratio is too high, the lender can't approve the loan.

By buying down the interest rate with discount points, and lowering the monthly mortgage payment, the debt-to-income ratio might actually go down to a level that satisfies the lender's needs.  A buyer who has plenty of cash on hand, but whose income isn't particularly high, might benefit from using discount points to qualify for a loan in this way.

On the other hand, borrowers with little cash on hand might have the opposite need.  They might have plenty of monthly income to support a high mortgage payment, but not enough cash on hand to pay for discount points or large closing cost fees.  In a home purchase, these borrowers might want to skip the discount points, or even ask their lender for "negative discount" options, which would effectively raise the interest rate slightly in return for reducing the borrower's overall closing costs.  The lender might be able to waive the origination fees/points on the loan if the borrower accepts a slightly higher interest rate on the loan.

Home buyers can also, in some cases, ask the home seller to pay for their closing costs, which can include discount points.  In the right situation, the buyer will negotiate a monetary credit from the seller.  When those funds are applied to the buyer's closing costs, it allows for the cash-poor buyer to finance more easily.  It can also allow a buyer to finance discount points and lower the mortgage payments in some situations.

Want to know more about discount points?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions.  Give us a call or send us an email and we can put you in touch with someone who can answer your discount points questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post
April 3, 2015

Real Estate: What is a Disclosure Statement?

disclosure statement

What is a Disclosure Statement?

Real Estate Terms and Definitions:
Disclosure Statement

Quick Definition: Disclosure Statements, in the case of mortgage lending, are detailed explanations of the specific loan for which you are applying. There are also seller disclosure statements, which allow the seller to inform the buyer of material facts about a home.

In-Depth Explanation of Disclosure Statement

Disclosure statements come in different forms.  In general, they are intended to disclose important information about a transaction to the parties involved:  buyers, sellers, and the service providers working as a part of the transaction.

Mortgage disclosure statements will tell the home buyer about the details of the financing they are applying for or being approved for.  Disclosures for financing often have required timelines.  The lender must let the borrower know at a certain time during the lending process what the terms of the loan will be.  The borrower then has time to review the lending disclosure statements and make sure that all terms are agreeable.  This keeps home buyers from having to make snap decisions at the closing table when their financing terms and payments don't seem to match up to what they were originally promised.

Disclosure statements can also come from sellers of real estate.  A homeowner may have disclosures about the history of the property, its condition, past material issues, or other items affecting its value or its ability to be transferred. 

Seller disclosures offer the buyer a way to understand the history of the property a bit better before purchasing a home.  They are not a replacement for an inspection, however.  Sellers are only required to disclose material facts which they should have reasonably been aware of, in most cases.  That means it's incumbent upon a buyer to inspect the property with a licensed inspector.

Sellers should err toward disclosing as much as possible.  While there might be a desire to hold back information that might not be necessary to tell buyers, if a known fact about a home might be deemed material to the condition of the home, sellers will usually reduce their liability by telling the potential buyers upfront about the issue.

How Disclosure Statement could affect your real estate transaction:

As discussed before, timelines regarding mortgage disclosures can affect your real estate closing.  Home buyers need to make sure their lender has all of their documentation upfront, at the beginning of the transaction.  Any further requested material should be delivered to the lender immediately.  This will allow the lender to get a final underwriting approval for the buyer's mortgage earlier in the process, and avoid potential delays due to disclosure timeline requirements.

As for seller disclosures, they should be prepared by the sellers before the home is listed on the market.  The real estate agent will usually have access to a standard disclosure form that the sellers can fill out.  With this information readily available to potential buyers upfront, the process of disclosure will be much smoother for all parties.

Disclosing material facts about the property upfront will also allow the seller to potentially divert inspection issues and repair requests further down the road.  If there is a particular portion of the property that may need work or have issues, the seller and buyer can discuss that disclosure upfront, and work it into the original purchase contract.  This way, it's not a surprise adjustment halfway through the purchase transaction.

There are legal ramifications to disclosing appropriately, so any and all questions about liability should be directed to a real estate attorney if there is doubt about the necessity of disclosure.

Want to know more about disclosure statement?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions.  Give us a call or send us an email and we can put you in touch with someone who can answer your disclosure statement questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post
March 26, 2015

Real Estate: What is a Deed?

deed

What is a Deed?

Real Estate Terms and Definitions:
Deed

Quick Definition: A legal document that conveys ownership of a property from seller to buyer.

In-Depth Explanation of Deed

A deed is the document that has the names of the owners who are selling a property and the names of the new owners who are buying the property.  It has a legal description of the property being sold.  The person selling/transferring the property will sign the deed to verify that they intend to transfer it.  The signed deed is written evidence of the transfer.

There are multiple kinds of deeds.  The simplest form is a quitclaim deed.  A quitclaim deed allows one person with a claim to a property to "quitclaim" it to some other entity.  It doesn't necessarily say how much that person's claim is, it merely says "Whatever portion of this property I have the rights to, I give those rights away to this new entity."  Quitclaims don't relieve their writers of any debts they may have become party to regarding the property, they merely assign the property claim elsewhere.  They're often used to clear up confusion when certain heirs to a property are in question.  To remove any clouds on the title, previous owners, or couples going through a divorce, may file a quitclaim deed to make it clear who has sole rights to the property.

Warranty deeds are stronger than quitclaim deeds because they include a promise of clear title.  They are usually accompanied by title searches and title insurance, because the writer of a warranty deed would be liable to the transferee if there were later found to be a separate claim on the property.  The warranty deed says that the transferor has a title that is free of financial liens or other claims of ownership.

Grant deeds are somewhere in the middle.  They include the basics of a quitclaim deed, but they also tell the transferee that the transferor hasn't previously deeded their claim to someone else.  There are cases where individuals quitclaim their property multiple times, creating clouds on title.  The grant deed states that the claim being transferred is unencumbered, unless specifically stated otherwise in the grant deed.

Deeds should be recorded with your local municipality, usually your county.  Although in some cases unrecorded documents are still legally binding, recorded documents are always better for everyone's ability to reliably transfer real estate ownership interests.

How Deed could affect your real estate transaction:

In the vast majority of cases, you'll only deal with the deed at your closing table, and that will just be to sign it.  Most transactions will include title insurance for the buyer, and often for the lender as well.  The title company will search to make sure there are no clouds on title--it's free and clear.  Then the warranty deed can be signed by the seller/transferor to clearly convey the interest in the property.

It can happen that the title search turns up clouds.  There could be financial liens against the property that were unreported, or the seller may have granted someone a claim to the property with a quitclaim at some time in the past.  These issues can slow down the sale process, and in some cases scuttle the transaction altogether.  

It's important for real estate agents who list properties for sale to have a preliminary title search done as they begin preparing the property to be listed.  This will give the sellers an early heads up if there are clouds on title and allow them to be fully prepared to sell the home when the time comes to put it on the market.

Want to know more about deed?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions.  Give us a call or send us an email and we can put you in touch with someone who can answer your deed questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post
March 25, 2015

Real Estate: What is a Conventional Loan?

conventional loan

What is a Conventional Loan?

Real Estate Terms and Definitions:
Conventional Loan

Quick Definition: Any loan not insured or guaranteed by a government agency. (Refers to loans made by institutional lenders.)

In-Depth Explanation of Conventional Loan

There are a lot of ways to explain a conventional loan, but the easiest way is to say what a conventional loan is not.  It is not a government insured loan like a VA or an FHA loan.  Mortgages/loans made by lenders that are not guaranteed or insured by a government agency like the VA or FHA are called conventional loans to signify that fact.  They're just "regular" loans.

FHA and VA loans are very popular because they have low down payment options.  VA loans (used by current and former military members and those with employment connections to the defense department) have "no money down" options which are often referred to as 100 percent financing.  FHA loans are often financed with 3.5 percent down payments.  The government agencies that insure them have special mortgage insurance options that sometimes are paid by the borrowers upfront to safeguard the agency against losses from default.

Conventional loans are sometimes confused with conforming loans.  Conforming is a different subject. Conforming loans are those that fit within federal guidelines that allow for them to be resold to agencies like Fannie Mae and Freddie Mac.  A loan must "conform" to the standards that make it fit within the safety guidelines that FNMA and FHLMC set up to safeguard their investments.  We often refer to conforming loan limits, which cap the total size of the mortgages.  These loan limits are often different based on geography.  A conforming loan might be capped at $400,000 in one city, but be able to go as high as $600,000 in a high cost city and still be conforming.

How Conventional Loan could affect your real estate transaction:

The seller of a home will often want to know about the buyer's financing.  In a purchase contract, you may have a financing addendum that will detail the kind of mortgage you're getting as a buyer.  The addendum may require you to tell the seller if you're getting a conventional, VA, FHA, or other kind of mortgage.  I will also often ask you how much of a down payment you're making.

Sellers will take this information into account when deciding whether or not to accept an offer.  There is no right or wrong loan type, and any particular home seller may look at them differently.  It's just more information for the sellers to analyze.

Conventional loans, in some cases, may have less stringent appraisal processes.  Every situation is different, but in many cases we see appraisers for FHA and VA do thorough inspections of homes and call for repairs to be done by the homeowners before closing.  In our experience, that's much less likely to happen with an appraiser for a conventional loan.

Want to know more about conventional loan?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions.  Give us a call or send us an email and we can put you in touch with someone who can answer your conventional loan questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post
March 18, 2015

Real Estate: What is a Contingency?

contingency

What is a Contingency?

Real Estate Terms and Definitions:
Contingency

Quick Definition: A Contingency is condition put in a contract that must be met for the contract to be binding. Common contingencies include financing, inspection, and others which protect buyers of real estate and their earnest money.

In-Depth Explanation of Contingency

Contingencies, in general, are conditions of a contract.  They need to be fulfilled for the contract to go through.  In real estate, contingencies can be put in place that protect buyers and sellers from financial or other harm.  Contingencies are written so that all parties to the real estate contract understand the they need to fulfill certain obligations before the real estate closing can happen.

The most common contingencies you'll hear about are financing contingencies and inspection contingencies, although there are many others.  Financing contingencies can be written in many different ways, but the overall point is to make sure the buyer properly applies for financing, and to protect that buyer from financial loss in case the financing is not available.

Financing contingencies will often have a timeline in which the buyer must apply for a mortgage.  The terms of the financing are often disclosed to the seller: down payment, type of loan, etc.  The seller uses this information to determine the strength of the buyer's ability to purchase the property.  If the buyer follows the terms of the contract, and the lending institution can't deliver the funds to make the home loan possible, the buyer usually has an option to get out of the purchase contract without losing earnest money.

Inspection contingencies work in a similar way.  They will have a timeline in which the buyer can inspect the property (which should be done with a professional inspector), and then respond to the seller.  The buyers can accept the property in its current condition, ask the seller for repairs or a monetary credit, or disapprove the inspection and end the contract.  These contingencies can vary based on timelines and disclosures necessary to enforce them, so be sure to consult with your Realtor and/or a real estate attorney to make sure you understand your contract.

How contingencies could affect your real estate transaction:

Contingencies are the basis for contracts going forward, or contracts dying.  Buyers use them as their safeguards.  If you're buying a home, you'll need to pay strict attention to the timelines on your contingencies.  Have you applied for a mortgage in the right amount of time?  Buyers should get pre-approved before even visiting properties for sale, but the contingency may allow more time.

Have you inspected the property, and provided a written response notification to the seller within the correct amount of time?  If not, your earnest money deposit may become forfeitable to the seller in case you don't close on the home.  

If you're selling your current home to buy another, you may have a property sale contingency or a pending sale contingency that allows you to rescind the purchase of the 2nd home if the 1st doesn't go through.  There are a wide range of contingencies, and you should be coordinating with your Realtor to make sure everyone is on the same page.

Want to know more about contingencies?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions.  Give us a call or send us an email and we can put you in touch with someone who can answer your contingency questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post
March 18, 2015

Seattle Condo Sellers: You CAN Always Get What You Want (100% List Price)

The Rolling Stones didn't know about today's market for Seattle condos.  For the average condo seller in Seattle, you can always get what you want, if what you want is full price on your condo listing.

The sale price to list price ratio for condos in Seattle this past month rose to 100 percent.  That means the average condo that sold last month got full asking price.  Take into account that many of these sales were homes that had been on the market more than a few weeks (condos that probably sold at less than asking price), and it's likely that two out of three condo sellers who get a sale in the first week or two are receiving at or above list price offers.

Seattle Condo Sales Median Prices, Sale to List Price Ratio

Seattle condo sales market stats

Condo prices have risen 27.5 percent over the past two years.  Tight inventory, rising prices, and a great employment market have been driving condo sales and there seems to be no slowing.  

The median sale price of a Seattle condo in January was $318,750, up from $250,000 in January two years ago.  Without much new inventory coming on the market, it seems inevitable that prices will continue to rise in the short term.

Prices in the downtown Seattle core were significantly higher, with last month's median condo sale coming in at $500,000.  The downtown, Belltown, Pioneer Square, and Denny Triangle neighborhoods seem particularly difficult to find available condos in these days. 

While there are a large number of new listings that sell in the first week on the market, Seattle condo buyers shouldn't get discouraged by the bidding wars and the competition.  There are still new listings each week that sit for a while and become opportunities for discounts and negotiations on prices.  

For Seattle condo owners thinking about selling their homes right now, though, it's a pretty ideal time.  Buyers are chomping at the bit, and the odds say that you'll sell quickly and for exactly the price you ask (as long as you price it based on market values).  

Get that condo on the market and get what you want.  We have buyers waiting.

- Search every real estate listing from every company in Greater Seattle on SeattleCondo.com -

New real estate listings in SeattleDetailed Seattle home searchWhat is my Seattle home worth?

Seattle Homes Group

© SeattleCondo.com
Sam DeBord, Managing Broker, REALTOR®, Coldwell Banker Danforth

Director, Seattle King County REALTORS® - State Director, WA REALTORS®
Twitter | Facebook | LinkedIn | Google + | Sam (at) SeattleHome.com

Statistical source if not otherwise noted is NWMLS. The Northwest Multiple Listing Service did not compile or publish this information.

Share This Post
March 17, 2015

Real Estate: What is a Comparative Market Analysis? CMA

comparative market analysis

What is a Comparative Market Analysis (CMA)?

Real Estate Terms and Definitions:
Comparative Market Analysis

Quick Definition: A survey of comparable homes recently sold or currently on the market used to help determine a fair market value for a seller's property.

In-Depth Explanation of Comparative Market Analysis

A CMA is usually delivered by a real estate agent or broker.  It is a report, a Comparative Market Analysis, of the current market value of an individual property.

The real estate agent will look at the subject property first.  After determining its location, condition, features, and unique characteristics, the agent will look for similar properties in similar locations to make relative value calculations.

CMAs can involved sold homes, pending sales, and homes currently on the market.  Comparables are often referred to as "comparable sales", but comparable active and pending listings can also give some insight into a property's value.

The agent will look at each comparable property, weigh its pros and cons in comparison to the subject property, and then make valuation adjustments.  By looking at multiple sold properties of similar size, characteristics, and locations, the agent can provide a very accurate picture of what the subject property would likely sell for if it were put up for sale.

Comparative Market Analysis reports are one of the most accurate ways to find your home's value if you're thinking about selling.  Automated Valuation Models (AVMs) found online can give rough estimates, but they often miss the mark by 10 percent to 20 percent.  That's far too wide of a margin of error for a homeowner to reliably trust.  To be reliable, the report must be done by someone who has actually seen the property in person and can verify its unique details and condition.

Homeowners can also get an appraisal to find out their home's value.  The appraisal report will be very similar to the CMA.  Appraisers usually charge a few hundred dollars for an appraisal report, whereas real estate agents will likely do the Comparative Market Analysis for free, with the hope that the seller will list the home with them in the future.

How Comparative Market Analysis could affect your real estate transaction:

Getting a good CMA upfront is important.  Sellers shouldn't just guess at their home's value, or hope to get a certain price when selling.  Buyers are educated, and they only want to pay what a home is worth.  If sellers skip the CMA step and just choose a price based on "what I need to get" or "what seems reasonable", they risk losing marketing time and money by being listed at an unreasonable price.  They could also leave money on the table by not pricing the home high enough in a hot market.

Have your Realtor do a full Comparative Market Analysis before you decide to list your home for sale.  Make sure that the market conditions will fetch you a sale price that's effective for your situation.  Whether you need the proceed funds from the sale to buy another home, or you might be close to being underwater, it's essential that you know the true market value of your home before putting it on the market

Of course, CMAs aren't perfect.  There are plenty of homes that sit on the market for longer periods of time because the initial analysis of value wasn't right on.  Still, a CMA is the best way to prepare yourself for the likely selling price of your home, and to discuss the unique features of your home with your Realtor.  It will give you a chance to see a professional's insight into which features of your home truly bring value to the majority of buyers, and which don't.

Want to know more about comparative market analysis?

This post is for informational purposes only and is not legal advice. Buyers and sellers of real estate should not rely upon it to make decisions. Consult with a licensed real estate broker and/or real estate attorney before making real estate related decisions.

We have real estate brokers, mortgage lenders, inspectors, title officers, and others who can answer your real estate-related questions.  Give us a call or send us an email and we can put you in touch with someone who can answer your comparative market analysis questions or any other questions about home buying, selling, and the real estate world.

Looking for more real estate terms and definitions?

Try the Real Estate Terms and Definitions Guide

Sam DeBord is Managing Broker with Seattle Homes Group and Coldwell Banker Danforth. Our team serves home buyers and sellers in Seattle, on the Eastside, and across the Puget Sound Region.

Explore Seattle Homes, and Search today's newest listings from every company in Greater Seattle.

Share This Post