How to Avoid Common Issues That Can Arise When a Home is Pending

There are a lot of moving parts when it comes to buying or selling a home. It’s a big transaction, and a ton of items need to be checked off before the property can transfer from one person to another.

A home sale is considered “pending” from the time that a seller accepts the offer up until the moment that the sale closes.

There are so many important steps that happen while the home sale is pending, such as the financing process, appraisal, inspection, title search, and more.

So, whether you’re buying or selling, it’s important to understand some of the most common reasons that a pending home sale falls through so that you can avoid any unnecessary issues.

Home inspection contingency
Once you accept the buyer’s offer, they will typically hire an inspector to make sure that everything is working properly. A home inspection contingency will allow the buyer to either renegotiate the sale price or walk away from the sale completely if concerning items were found during the inspection, such as problems with the roof, foundation, heating and cooling systems, mold, termites, or other big-ticket items.

To avoid any unexpected issues, sellers should hire their own inspector before putting their home on the market. Either fix the items listed in the inspector’s report, adjust your pricing, or offer the buyers a seller’s credit that will go toward the cost of the repair.

Financing Falls Through
Typically, a buyer is pre-approved for their financing before putting an offer in on their home. However, a change in their status could mean that their financing falls through. This could be a change in their employment, a new negative credit issue appears, or they’ve taken on new debt. For this reason, many real estate agents recommend accepting either an all cash offer, or an offer from a local, trusted bank or mortgage lender.

Low Appraisal
In some cases, the appraisal might come back lower than the contract price. This is an issue because banks and mortgage companies will only lend up to the value of the property. So, if the buyer can’t pony up enough cash to cover the difference, then their financing could fall through. As a seller, you would need to make a decision to either let the deal fall through or lower the sales price. The seller could also hire another appraiser in hopes of a different answer, or make a case to the appraiser, using recent neighborhood sales prices or other evidence, that the home should be appraised at a higher value.

Buyer home sale contingency
Sometimes a buyer’s financing is dependent on them selling their current home. If their home doesn’t sell quickly, then your home sale could be pending for quite some time. 

Property title issues
Prior to closing, the buyer’s lender will order a title search to find out the ownership of the property and find out if there are any liens or claims against the property. A clean title is required before the transaction to close. So, if there are any liens or claims against the property it could take weeks or months to get them sorted out. Depending on the seriousness of the title issue, some buyers may walk away from the sale.

Content provided by TowneBank Mortgage for informational purposes only. The information contained herein (including but not limited to any description of lending programs and products, eligibility criteria, interest rates, fees and all other loan terms) is subject to change without notice. This is not a commitment to lend. TowneBank Mortgage NMLS# 512138.


2023 Loan Limit Updates

As home prices have increased throughout the country, loan limits increased as well. Both the Federal Housing Agency (FHA) and the Federal Housing Finance Agency (FHFA) announced new loan limits in late 2022. 

Here are the changes:

New FHFA Conforming Loan Limits:

The FHFA’s floor and ceiling loan limits will see a 12.21% increase in 2023.

  • The maximum base conforming loan limit for single-unit properties is $726,200, an increase from 2022’s limit of $647,200.
  • The high-cost area maximum limit for single-unit properties is $1,089,300, an increase from 2022’s limit of $970,800.

For a list of the 2023 maximum loan limits for all counties and county-equivalent areas in the U.S, click here

New FHA Loan Limits:

The FHA’s floor and ceiling loan limits will see a 12.21% increase in 2023. 

  • The new floor (limit for low-cost areas) FHA limit is $472,030, an increase from last year’s base limit of $420,680.
  • The new ceiling (limit for high-cost areas) FHA limit is $1,089,300, an increase from last year’s ceiling limit of $970,800.

To find the limit in your area, click here.

The information contained herein (including but not limited to any description of lending programs and products, eligibility criteria, interest rates, fees and all other loan terms) is subject to change without notice. This is not a commitment to lend.

*Content provided by TowneBank Mortgage for informational purposes only. The information contained herein (including but not limited to any description of lending programs and products, eligibility criteria, interest rates, fees and all other loan terms) is subject to change without notice. This is not a commitment to lend. TowneBank Mortgage NMLS# 512138.


Winterizing Projects to Knock Out this Weekend

There’s probably a long list of things that you’d rather be doing than winterizing your home- like curling up to the fire with a cup of hot chocolate. But “Winterizing” your home can protect you from incidents that could cost you a lot more time and money in the long run. So, protect yourself against Mother Nature’s icy wrath, and save yourself some money on utilities, by knocking out these winterizing projects:

Protect your pipes- Reduce the chances of bursting pipes by keeping your home warm, insulating your pipes with sleeves if needed, and turning off the water to all exterior facets. If temperatures drop dramatically below freezing, you can drip your facets to further reduce the chances of bursting pipes.

Check your fireplace- If you haven’t already, have your fireplace inspected. Keep the flute closed when not in use to prevent warm air from leaving and insects or critters from getting in. Now is also a good time to test your fire alarm and replace batteries if needed.

Service your furnace. If your gas furnace is dirty, inefficient or old, it runs the risk of leaking carbon monoxide- an odorless yet deadly gas. Have your furnace serviced to ensure that its working properly. You can also install carbon monoxide detectors near your furnace.

Change your furnace filter. Dirty filters are bad for your health and make your furnace have to work harder. Furnace filters should be replaced every month in the winter.

Caulk and weather-strip- If needed, caulk or weather-strip doors and windows that leak air. Depending on quality, caulk needs to be replaced about every 5 years. Your weather-stripping should be replaced if you can see light around the edges of your doors.

Weatherproof your windows- if you have older windows, you’re probably losing a lot of warm air through them. If you don’t have the money to invest in new windows, you can purchase plastic film insulation- a budget friendly solution that can help insulate your windows quickly and easily.

Consider investing in a programmable thermostat. These high-tech thermostats can be programmed to lower temperatures while you’re at work or sleeping, helping you to save energy and cut costs.

Clean your gutters and downspouts and trim branches. If you cleaned them in the fall, check them again to make sure they’re clear. Trim branches that hover over the roof.

Store your outdoor equipment and furniture- Extreme cold weather and elements can cause damage to outdoor furniture, grills and lawn equipment. Move what you can into storage. If you’re keeping your grill outside for the winter, protect it with a cover and keep the propane connected but turned off. If you’re bringing the grill inside, leave the take outside in an upright position.

Prepare an emergency kit- If the power were to go out due to a winter storm, make sure you’re prepared with firewood, bottled water, nonperishable food, blankets, flashlights and candles and plenty of batteries.

Disclaimer:

Content provided by TowneBank Mortgage for informational purposes only. The information contained herein (including but not limited to any description of lending programs and products, eligibility criteria, interest rates, fees and all other loan terms) is subject to change without notice. This is not a commitment to lend. TowneBank Mortgage NMLS# 512138.


What Every Seller Should Know About Home Prices


While home prices are down slightly month-over-month in some markets, it’s also true that home values are ⬆️ nationally on a year-over-year basis.

📈 As the graph shows, it’s true home price growth has moderated in recent months (shown in gold) as buyer demand has pulled back in response to higher mortgage rates.

💰 While you may not be able to capitalize on the 20% appreciation we saw in early 2022, in most markets your home’s value, on average, is up 10% over last year – and a 10% gain is still dramatic compared to a more normal level of appreciation (3-4%).

❔If you have questions about home prices or how much equity you have in your current home, reach out to one of our agents for expert advice.

#intracoastalrealty #mortgagerates #realestate #wilmingtonrealestate #coastalnorthcarolina #homeprices #realestatemarket #appreciation #realestateexperts #experiencetheexceptional


Shifting Market: Inventory, Equity & Foreclosures

🏘️ With the rapid shift that’s happened in the housing market this year, some people are raising concerns that we’re destined for a repeat of the crash we saw in 2008.

🏘️ At the time of the crash, there were more relaxed lending standards that allowed people to take out mortgages that they couldn’t afford. Those practices led to a wave of distressed properties which made their way into the market and caused home values to plummet. But today, revised lending standards have led to more qualified buyers.

🏘️ While it’s true the number of foreclosures is higher now than it was last year, foreclosures are still well below pre-pandemic years.

🏘️ Many homeowners today have enough equity to sell their homes instead of facing foreclosure. Due to rapidly rising home prices over the last two years, the average homeowner has gained record amounts of equity in their home.

🏘️ The increase we’ve seen in housing supply this year is because homes are staying on the market a bit longer (known as active listings) vs an influx of recent homeowners listing their houses for sale (known as new listings).

🏘️ That’s happening because higher mortgage rates and home prices have helped moderate the peak frenzy of buyer demand, which has slowed down the pace of sales. And, as the pace of sales has eased, inventory has grown as a result.

🏘️ Our market is very strong in Southeastern NC and there are still many ways you can take advantage when considering your real estate goals. If you have questions, reach out to one of our trusted and qualified real estate professionals!


Your Home Could be the Ultimate Christmas Present

Each year, homeowners planning to make a move are faced with a decision: sell their house during the holidays or wait. And others who have already listed their homes may think about removing their listings and waiting until the new year to go back on the market.

The truth is many buyers want to purchase a home for the holidays, and your house might be just what they’re looking for. Here are five great reasons you shouldn’t wait to sell your house.

➡️ While the supply of homes for sale has increased this year, there still aren’t enough homes on the market to keep up with buyer demand.

➡️ Serious homebuyers are out looking right now. Millennials are driving homebuying demand today, and many are eager to make a purchase.

➡️ The desire to own a home doesn’t stop during the holidays. In fact, homes decorated for the holidays appeal to many buyers. Plus, purchasers who look for homes during the holidays are ready to buy.

➡️ You can restrict the showings in your house to days and times that are most convenient for you. That can help you minimize disruptions, which is especially important this time of year.

➡️ Rents have skyrocketed in recent years. And, many buyers are looking to escape rising rents and avoid falling into the rental trap for another year.

There are many reasons it makes sense to list your house during the holidays. 🎄 Reach out to one of our real estate professionals to determine if selling now is your best move.


How to Save on Holiday Shopping with Rising Inflation

The most wonderful time of the year is here yet again. Spreading joy with presents and gifts for family and loved ones is part of what makes the holiday season so special. But it’s not always easy on our bank accounts. Rising prices brought on by inflation may influence you to shop earlier and spend less money than in previous years.

So how can you cut back and still spread cheer this holiday season? Here are a few tips that can help:

First things first, get into the holiday spirit – The point of a budget isn’t to ruin your holiday fun. After all, the holidays are all about slowing down and spending quality time with the ones you love. Don’t stress about finding the perfect gift for everyone on your list. Instead, put some time and thought into how you can help make their holidays memorable, whether it’s surprising a relative by coming home for the holidays or reestablishing an old holiday tradition.

Set a limit for your holiday spending – Never spend money that you don’t have available to you, or that should be designated toward paying bills. Start by making a list of everyone that you need to shop for this holiday season—including co-workers, clients, your children’s teachers, etc. Next, pick a dollar limit you’d like to stick with for everyone on your list. If money is tight this year, consider marking some people on this list as “card only” or homemade gifts, such as a holiday pie or a handmade ornament.

For a stress-free shopping experience, the earlier you start, the better. You’ll have more time to research deals and shop around, and you’ll feel less pressure to get your shopping done.  

Give the gift of time – Not all presents need to have a monetary amount. Giving the gift of time or support to a loved one during the holidays can be just as important. Volunteer to help mom make Christmas cookies or help your brother wrap presents for his kids.

Compromise on other aspects of your budget – Like mentioned earlier, you should never spend money that you don’t already have in your bank account. You can, however, cut back on other aspects of your regular spending, such as your own clothing, food, and drink or recreational spending to make room for your holiday spending.

Make it meaningful – While electronics or designer clothes are always a fun gift, they don’t have as much meaning behind them. A meaningful gift is something that the recipient will cherish and hold onto- like a framed photograph or a family heirloom. 

Do your research – There are plenty of deals to be had this holiday season. Research different stores to help find the lowest price on your gifts, and don’t be pressured into buying something that’s not on your list just because it’s on sale.

Save your receipts – See if you are sticking to your budget by saving all your receipts and reviewing them once you’re done shopping. Save your receipts for next year to give yourself an idea of how much you spent the previous year, then adjust your budget or your shopping habits based on that amount. 

Lastly, don’t forget to budget for other holiday expenses, such as food and drink, transportation costs, gift wrap and cards, etc.

We wish you a happy and safe holiday season!

Disclaimer:

Content provided by TowneBank Mortgage for informational purposes only. The information contained herein (including but not limited to any description of lending programs and products, eligibility criteria, interest rates, fees and all other loan terms) is subject to change without notice. This is not a commitment to lend. TowneBank Mortgage NMLS# 512138.


What is a Temporary Buydown?

Have you recently been home shopping? If so, you might have heard the term “temporary buydown”. As a seller, you could have heard of it being utilized as a strategy to aid in the sale of your home. 

There seems to be an increased interest in temporary buydowns in today’s market. But what are they?

Temporary Buydowns

A temporary buydown is when the interest rate on your loan is temporarily reduced, commonly for the first few years of the loan. 

A buydown may be funded by either the borrower or seller. For instance, we only offer seller-paid buydowns. In a seller-paid buydown, the seller covers the difference between what the buyer’s monthly payment typically would be and the reduced rate. 

(If you are a buyer interested in reducing your interest rate, you may be able to purchase “points,” which allow you to pay more upfront in exchange for a lower interest rate.)

Buydown funds are an upfront, cash deposit. A portion of the funds is released from an escrow account each month, allowing the lender to temporarily reduce the buyer’s interest rate and monthly payments. 

We offer eligible borrowers 2-1 and 1-0 temporary buydowns.

  • A 2-1 Buydown reduces the note rate by 2% the first year, followed by 1% the second. The non-reduced rate applies years, 3-30.
  • A 1-0 Buydown reduces the note rate by 1% the first year. The non-reduced rate applies years, 2-30.
  • Eligible borrowers must still be qualified at the final note rate.
buydown-example.PNG

*Additional eligibility requirements and restrictions may apply. Amount must be considered in seller contribution limits in accordance with FNMA, FHLMC, VA and FHA guidelines.

Benefits to the Seller

  • Avoid reducing the home’s list price by offering a temporary buydown, which provides an incentive to buyers and can be a less costly option.
  • Can make your home appealing to more buyers, especially in a higher-rate environment 

Benefits to the Buyer

  • Provides a lower initial interest rate with the stability of a fixed-rate once the buydown period ends. 
  • Ideal for buyers who plan to have higher earnings within a few years of purchasing since the rate will increase.
  • Save more money up front and use the extra cash for necessary repairs, small renovations, or other home expenses.

Temporary Buydown vs. Discount Points

Discount points are used to buy down the interest rate for the life of the loan. Temporary buydowns will only lower the rate during the buydown period. Once the buydown funds run out, the buydown period ends and the original note rate applies.

Content provided by TowneBank Mortgage for informational purposes only. The information contained herein (including but not limited to any description of lending programs and products, eligibility criteria, interest rates, fees and all other loan terms) is subject to change without notice. This is not a commitment to lend. TowneBank Mortgage NMLS# 512138.


Trend-Spotting Tools

Intracoastal Realty’s Business Intelligence Dashboard is a tool used by our agents to stay abreast of the ever-changing market. Real-time data from the MLS is parsed to identify trends and to help with property marketing and pricing strategies. This is one of many resources that helps our firm deliver an exceptional real estate experience.

Sold Price vs. List Price Trend?

One set of data that we’ve been monitoring closely is how many properties are selling above, below, or at the list price. A quick look at closings in August reveals more properties selling below list price than at or above. In fact, 45% of listings sold below list price, compared to 37% selling above list price and 18% selling at list price.

Bottom Line: While it remains a seller’s market with relatively high buyer demand, inventory has been increasing steadily over the past few months. With buyers having more properties from which to choose, pricing has become increasingly important.