When a homeowner (borrower) has missed a mortgage payment, the lender will send a notice indicating that they have not received that month’s payment.  After two payments are missed, the lender will usually send a “demand letter” and the homeowner would need to remit the late payments within 30 days of receiving the letter.

If after 90 days, the lender has not received missed payments, a notice of default will be issued, and the loan will be handed over to the lender’s foreclosure department.  The lender will usually give the borrower another 90 days to settle the payments and reinstate the loan.

If the loan has not been brought up to date within the allotted time, a notice of trustee’s sale will be recorded and the lender will publish a notice in the local newspaper, announcing that the property will be publicly auctioned.  The notice will include the owners’ names, a description of the property, the address and when and where the sale will occur.

At the auction, the home will be awarded to the highest bidder.  The opening bid is generally based on the value of the outstanding loan, costs associated with the sale and any liens or unpaid taxes.  Once the sale is completed and the highest bidder meets all necessary requirements, a “trustee’s deed upon sale” will be given to the winning bidder.  The house is then immediately in the possession of the purchaser.

If the home cannot be sold at auction, the lender becomes the owner and will try to sell the property through a broker.  Usually these are referred to as “bank-owned” properties.  Sometimes the lender may remove some of the liens to help sell the property faster.

Once the home is sold, either at auction or through a broker, the borrower will be evicted.  Sometimes they may be allowed several days to remove any personal belongings, but if they have not left the premises, the local authorities will be notified to evict the borrower and remove their belongings.

Many homeowners believe that once they miss a couple of mortgage payments, talking to their lender won’t help.  However, many lenders want to make arrangements for the borrower to get caught up on the loan rather than go through a foreclosure. If you have lost your job or suffered a health crisis and run the risk of foreclosure, speak with your lender immediately. However, if a foreclosure is unavoidable, knowing what to expect throughout the process can help better prepare you.

If you are interested in purchasing a foreclosed home, or other Arizona Real Estate, please give me a call at 602-904-1496 for all of your real estate needs.

Today’s home security systems are more advanced and more effective than ever, and can be very affordable for a homeowner. There are two main types of home alarm systems: wired and wireless. With a traditional hard-wired alarm system, wires run from the main system to every point and motion detector in the house which includes all doors and windows. Setting up a hard-wired alarm system can be labor intensive but has been traditionally a very dependable way of securing your home. If you are having a home built, having the wires ran during the construction phase will be the most cost effective.

Wireless systems have become popular in recent years because they are easy to install, easy to troubleshoot and portable. Wireless home alarms run on radio wave frequencies that are transmitted from motion sensors and contacts to the central unit. Wireless systems are ideal for older homes and for homes that are multi-level. Because a wireless system is powered by lithium batteries, it’s not vulnerable to wires being cut by an intruder. It’s also easy to maintain, requiring only a regular check on batteries to make sure they are functioning properly. Wired and wireless systems also have other monitoring features that can detect if there is a fire, carbon monoxide or flooding. Deciding whether to choose a hardwired or wireless alarm system will ultimately depend on several factors including your lifestyle, type of house and your budget.

Not only is indoor security important, but so is outdoor security. One of the first steps to outdoor security is making sure there is adequate lighting. Whether you decide to use continual lighting or motion sensor flood lights, keeping vulnerable areas lit at night is one of the best ways to prevent trespassers from prowling around in the dark. Home surveillance cameras have also become a popular home security option in recent years. You want a camera that will be able to record detailed movement, functions well in low lighting and is weather resistant. If you can’t afford an outdoor camera, installing a fake camera is an inexpensive way to scare off intruders. Other outdoor security options can include driveway alarms that can alert you to possible trouble, strategically placed landscaping such as planting a thorny bush under a window, or placing your security provider’s sign in a visible location. Regardless of what type of outdoor security you decide to implement, always make sure you have strong locks, reinforced doors and secure windows to deter criminals.

Homeowners who have a home alarm system installed will be able to lower their homeowner’s insurance rates and it can increase your home’s resale value. Having a solid security plan coupled with good security habits and human surveillance is the best way to prevent a home invasion and bring peace of mind to you and to those important in your life.

1. Low water pressure
Low water flow can be an indication of plumbing problems such as corroded pipes or build up of deposits. To test, check for weak flow in the bathroom sinks, see if there is a long delay before the water turns hot and check for faucet flow when flushing the toilets. If low water pressure exists throughout the home, have a plumber come out to see if you have a potentially pricey problem.

2. Stains on the ceiling
Any kind of stains on the ceiling is usually an indication of water damage because of leak. It could be a leak from the roof or even a shower, if the stain appears beneath the bathroom. If the roof leak has existed for a lengthy amount of time, there could also be a more serious problem of mold. Having to replace a roof or eradicate mold can be an extremely expensive endeavor, so either keep looking or factor in this condition when you negotiate price with the seller.

3. Hard to close doors
One bad door usually isn’t a problem. But if several doors in the home are hard to close, swing open by themselves or fail to open fully, there could be foundation problems or framing that is deteriorating.

4. Odors
Pet odors, musty smells or cigarette smoke can be extremely difficult to get rid of. If the house smells too clean, the owner may be trying to cover up. Be sure to investigate thoroughly and ask plenty of questions.

5. Sloping exterior features
A porch or driveway that slopes towards the home usually mean water in the basement which can lead to structural damage and mold. If the basement smells musty, or the walls have stains, these are good indications there has been flooding or water penetration. Solving the problem can be cheap if you only have to add gutter extensions or cost thousands of dollars if you have to excavate and build exterior or buried drains.

If you are looking to buy an Arizona home, and need a honest realtor who can help you find the perfect house for your needs, please give me a call day or night at 602-904-1496 or send me an email by clicking here.

1. You might not have time to do research: If you decide to buy a foreclosed home at auction, you won’t have time to research it. Liens will be wiped clean and you will be responsible for any property taxes. There is also no home inspection, and homes sell sight unseen. You could also get into a bidding war and end up paying more that you intended. Bargains can be had at auctions, but the risk may not be worth it.

2. Your profit can disappear with repair costs: Many foreclosed homes can be bought at a great price; however, if you don’t factor in the costs of repairs and maintenance your profit margin can be slim or next to none. For example, let’s say you buy a foreclosed home at $300,000 that’s worth $350,000. But the previous owners trashed the place. So you have to spend, $10,000 on carpet and paint, and then another $15,000 on the leaky roof and mold that has been discovered. Throw in more repair costs and your closing costs, and now your foreclosed home doesn’t look like so much of a great deal.

3. You run the risk of legal entanglement: As long as the owner still occupies the property, you could end up trying to process an eviction or finding yourself liable for back taxes on the property. Make sure you have an experienced Arizona real estate attorney or realtor working for you in order to negotiate aggressively and to mitigate your risks.

4. You may have to evict the current homeowners: Things could get nasty if you have to evict lingering residents from their lost home. Plus evicting homeowners can be an emotional process for you. Be prepared for previous owners to take out their anger and disappointment over the foreclosure of their property if you have them evicted.

This is a buyer’s market and there are many houses available at great deals that aren’t foreclosed. However, if you really want to buy foreclosed Arizona real estate, look for pre-foreclosures and don’t buy sight unseen. Buying a pre-foreclosed home will give you time to get a comparable market analysis and have the home inspected. You’ll also have time to negotiate the best deal. Whatever you do, don’t downplay the role of a qualified Arizona realtor to help you find and purchase foreclosures at the best possible prices. If you are looking to buy a home for your own personal residence or as an investment, please give me a call at 602-904-1496.

A: In one word: absolutely. Just because the home is new, doesn’t mean there won’t be defects that need to be corrected. It is not unusual for a general contractor not to know what his subcontractors have done. Home inspectors often find defects in the crawl space under the home or in the attic, such as broken trusses, crimped duct work or lack of insulation. There can also be foundation problems or incorrect wiring which can cause huge problems in the future.

A good time to have a home inspector come is for a “pre-drywall” inspection so the insulation can be inspected before the drywall is installed. A few people will also hire the inspector to come back and examine their house before their warranty ends on cosmetic issues. When looking for a home inspector, do your homework and find one who is experienced in building or remodeling. You can search online at websites such as www.nahi.org or your realtor can also provide you a list of recommendations. If you are looking to purchase Arizona real estate, please give me a call at 602-904-1496. I can help you through the entire real estate process from finding the right home to selecting a professional home inspector who can give you peace of mind and protect your investment for years to come.

1. Install a home security system
Home alarm companies recognize that home security systems reduce theft and home invasions. By installing a home alarm system with a monitoring service you can lower your homeowner’s insurance premiums by up to 20%. Check with companies such as ADT, Broadview Security or APX Alarm who all offer premium reductions.

2. Install additional smoke alarms
New homes come with smoke alarms, but by installing additional smoke alarms in older homes, you can reduce your rates by 5-10%. Home alarm companies also offer fire and smoke detection services which can not only reduce your premiums but save your life in case of a fire.

3. Look for multiple policy discounts
Some insurance companies will offer a discount if you have more than one policy with their company. See if your homeowner’s insurance company also offers auto or life insurance which can usually save you up to 10% on a combined policy.

4. Review your policy annually
It’s a good idea to review your insurance policy once a year and compare with other companies to see if there is a better rate available. If you have made any changes (such as added a burglar alarm), an annual review is the time to address those changes which could lower your premiums.

5. Be careful of recreational risks
Trampolines, swimming pools and hot tubs will almost always raise your damage liability premiums because of the high rate of injuries and death. If these recreational additions are important to you, consider building a fence around your pool, or installing a safety net around your trampoline, to help mitigate the additional costs.

6. Raise your deductible
The higher the deductible, the lower your homeowner’s insurance premiums will be. However, be prepared to absorb the cost of smaller claims such as a broken window or leaky pipe. Raising your deductible too high may not be worth it for an older home that needs constant maintenance and repairs.

• $8,000 tax credit is available for first-time buyers or those who have not owned a home for 3 years.
• Homeowners who buy a new principal residence after living in their current home for at least the last five years can claim up to $6,500.
• Credit is available for homes that go under contract by April 30, 2010 and close within 60 days after that
• Income limits are $125,000 a year for individuals and $225,000 a year for married couples.
• The plan will include anti-fraud measures such as minimum age requirements and additional authorities for the IRS

If you are a first-time homeowner, don’t wait for Congress to act.  Take advantage of the current home buyer tax credit today!  Call me at 602-904-1496 for your real estate needs.

Mary L. in Chandler, AZ

A: Mary,
Your neighbors could face prosecution if they decide to strip their home. Not only is it considered a felony in Arizona, but it morally wrong. The following is a list of items that must stay in the foreclosed home:

• Appliances such as built in microwave, dishwasher etc.
• Cabinets and counter tops
• Furnaces and air conditioning units
• Plumbing and copper pipes
• Electrical wiring
• Light fixtures and ceiling fans
• Doors and hardware
• Flooring such as tile and carpet
• Windows and vents
• Medicine cabinets, sinks, tubs, toilets and showers
• Sink drains and faucets
• Landscaping, fencing, built-in pools and spas
• Built-in shelving / bookcases

Here are some other things you legally cannot do:

• Smash windows
• Spray paint walls or windows
• Turn on all the water faucets and plug up the drains

However, there are certain items a home owner can legally remove:

• All personal items brought into the home by the owner such as furniture, clothing and common household items such as dishes, pans and silverware
• Mirrors
• Personal artwork and photographs from walls
• Stationary lamps
• Pets and pet-related items such as dog houses or aquariums
• Drapes or curtains
• Refrigerators, televisions, computers and stereo equipment
• Area rugs
• Indoor plants
• Portable fans and heaters

I would strongly suggest that you talk to your neighbors and persuade them to reconsider rather than face the potential of serious consequences.

Do you have a real estate question?  Send me an email at: aboydston@redbrickrealty.net

In the West, pending sales rose 16 percent and home values in 20 metropolitan cities climbed in July by the most in 4 years. All indications show that people are getting back into the market and the housing market is on the slow road to recovery.

1. Green Building Incentive – The Green Building incentive was created to encourage environmentally responsible building. If you live in Scottsdale or Buckeye and build your home to the green standards given in the Green Home Rating Checklist, you can be eligible for an array of benefits including expedited plan review and free promotional green building materials In Tucson, there is a Permit Fee Credit for installing solar energy systems.

2. Personal Deduction – A personal deduction is available for biomass wood stoves that convert and existing wood stove into one which meets new industry standards. The maximum deduction for this incentive is $500.

3. Personal Tax Credit – Receive a 25% personal Tax Credit for installing solar and wind energy systems in your home.

4. Property Tax Exemption – If you install a solar energy device for heating and cooling, Arizona residents can claim 100% of the increased value.

5. Sales Tax Exemption – Those who purchase a solar power device for their residence are 100% exempt from sales tax. Retailer needs to be registered with the Arizona Department of Revenue.

6. Utility Loan Program – APS’s GEOSmart Financing Program encourages people to finance solar energy in their neighborhoods by offering loans for up to $50,000 at interest rates of 7.99% to 12.99%.

7. Utility Rebate Program – APS and SRP as well as several other small utility companies in Arizona offer utility rebate programs for renewable energy. To learn more visit: http://www.srpnet.com/environment/earthwise/solar/default.aspx or http://www.aps.com/main/green/choice/choice_2.html