Monthly Archives: September 2009

Don’t Buy That Furniture (If you want the $8000 tax credit, that is)

Good article in the WSJ about how lenders might actually be checking your credit on closing day, hence advising would-be benefactors of the $8000 first time homebuyer tax credit to NOT buy stuff until after you close.

Here’s some more of the good snippets from the article:

With the deadline on the first-time home buyer tax credit looming, plenty of buyers are under contract and looking to close before Nov. 30.  Excited to move into a new home, some of these first-timers start hitting the stores shopping for new furniture, appliances or curtains.

Big mistake.

Real estate agents are reminding buyers to wait until the close to start buying stuff.  The reason: Lenders are occasionally running credit reports on closing day, and they might not like to see an increase in credit card debt or indications that debt could soon increase.

While such measures have been used over the years, lenders, still dealing with the fallout from the boom’s lax lending standards, are being especially particular these days. Even buyers with great credit scores face scrutiny.

Agents also advise not moving money between accounts, so don’t join two savings accounts, transfer large sums out of savings or add more funding to checking. Emptying out an account could look like money’s being spent, and lenders might request a paper trail for the money flow.  That could delay the closing or, in rare cases, terminate the loan. That wouldn’t necessarily free the buyer from the obligation to buy the home.

Dan Rider, a broker with Dickson Realty in Reno, Nev., says one of his recent closings was delayed by five days when lenders spotted a $500 deposit in a buyer’s checking account. It wasn’t a gift – it was a repaid loan from her mother – but it sparked concerns that the buyer needed help to close the deal. Though the buyer had a healthy checking balance, the lender wanted canceled checks and bank statements and both parties had to write an explanatory letter.

BOTTOM LINE: Stay out of the stores. Don’t move money around more than necessary.


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Tales of Buffoonery, aka What the Heck is Bank of America Smoking?

Ok, I only republish these three stories below because the last two transactions I’ve had where B of A was the buyer’s lender have me totally convinced that BofA’s left hand does not even KNOW there is a right hand. Ok, ok, I know that mortgage regulations did need to be more restrictive compared to the free-wheeling days of 2003-2006 — but boy, the pendulum has just swung so far to the other end of the spectrum, it can just make a buyer pull their hair out while continually uttering “WTF?”

Read on:

BofA requires armless man to provide fingerprints to access his cash:

BofA forces homeowner to buy flood insurance (when she lives on the crest of a big hill)

Tales of Short Sale insanity in dealing with BofA

(quick note: I’m just republishing this one, I’m not condoning his metaphor….but do note this, the thesaurus usage of “retard”:  “the process is retarded by bureaucratic red tape delay, slow down, slow up, hold back, hold up, set back, postpone, put back, detain, decelerate; hinder, hamper, obstruct, inhibit, impede, check, restrain, restrict, trammel.”)

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Support a Redwood City Biz – The Movie Groove & Grind

In an effort to promote the great local businesses of Redwood City, I have this, courtesy of a handful of friends:

I wanted to recommend a great local business here in RWC that is having a hard time financially and we would hate to see them go out of business.

“The Movie Groove and Grind” DVD/video rental and adjacent cafe is a fun and slightly eccentric location where you can rent great movies and get what I consider the best coffee in town. The business is located on the corner of Jefferson and El Camino Real (across Jefferson from Whole Foods). If you haven’t ever been there, please stop in and check them out – if you have been there, please visit again soon!

Here are a few reasons why:

  • they offer personable and very knowledgeable service and can make great movie recommendations when you need one
  • Scott, Stephanie, and the staff are great in helping direct your kids to worthwhile movies that are age-suitable
  • you can get every movie there, new or old
  • their custom, made to order gourmet drip coffees are unique and delicious (my favorite is called “The Mexican”, it’s like a dessert)
  • they make the best latte in town
  • for the kids, they make organic hot or cold chocolate milk

We would be so sad to see this business close. Please pass this on to others you know in our area. Thanks for your support!

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Filed under Community Info, mt. carmel, real estate, redwood city