What is 'DU'?

If you're a buyer out there actively looking for properties, you may have run across a seller looking for you to provide your 'DU' with your offer.

Huh...?

No worries -- here's a primer on what a DU is, courtesy of Scott Groves at Prospect Mortgage:

DU - short for desktop underwriting - is the computer software provided to lenders from Fannie Mae and Freddie Mac. With many offers and pre-approval letters, lenders are being asked to provide "DU" findings. Running "DU" simply means that a lender has run their loan application through a computer system that spits out an answer of either approve or decline. A few things to keep in mind about DU:

Garbage in, Garbage out. DU has no way of verifying the underlying documentation that created the information on the app... that's why we still have human underwriters. Like all computer programs, the results are only as accurate as the data which is input. The accuracy the DU findings (approve, eligible, ineligible, refer, decline, ect) are only as good as the loan officer who is inputing the data.

There are a half dozen different answers that can come back from DU. The only one that an underwriter wants to see is "Approve/Eligible."

DU is a powerful tool for borderline situations. It can help to identify obscure guidelines like cash reserves required for specific transactions and minimum credit scores for non-occupant co-borrowers. However, even with DU, there is no substitute for a seasoned loan officer.

So next time you get asked for a DU, don't sweat it - just reach out to your loan officer. :)

Happy Buying!

Caroline Choi Real Estate
Caroline Sells The City LA
www.CarolineSellsTheCity.com

Article: Rising House Prices Make Selling More Attractive

I'm sure if you're interested in the real estate market at all these days, it's pretty clear the market has changed, not only from last year, but even within the last 6 months!

Courtesy of our friends at National Mortgage News, here's an article that's speaking to what the market is doing now:

Rising House Prices Make Selling More Attractive

By Brian Collins
MAY 7, 2013 10:08am ET
Courtesy of:
www.nationalmortgagenews.com

House prices jumped 1.9% in March from the prior month, which sent the year-over-year increase in prices to their highest level in seven years.

CoreLogic reported Tuesday morning that home prices nationwide are up 10.5% from March 2012.

This change represents the biggest year-over-year increase since March 2006 and the 13th consecutive monthly increase in home prices nationally, according to the company’s chief economist Mark Fleming.

“The pace of price appreciation has been accelerating throughout 2012,” Fleming said, and it is continuing into the 2013 home buying season.

However, the upward trend in prices is being fueled by a limited supply of homes on the market and increasing demand from investors and homeowners.

But rising prices help more underwater borrowers return to position equity. And it makes selling more attractive for many homeowners who have been waiting for the right time to put their house up for sale.

Fannie Mae released its April National Housing Survey on Tuesday, which shows increasing optimism about the housing recovery.

“For the first time in the survey’s three-year history, the majority of Americans surveyed now expect home prices to increase,” said Doug Duncan, senior vice president and chief economist at Fannie Mae.

He also noted that the share of homeowners who think it is a good time to sell has doubled from 15% last year to 30% in April.

“With these gains, the housing market is poised to enter the spring selling season on sound footing,” Duncan said.

When you have the knowledge, it's easier to move forward with the best decision for you. Stay informed!

Happy Buying and Selling!

Caroline Choi Real Estate
Caroline Sells The City LA
www.CarolineSellsTheCity.com

Vesting Descriptions in California

In that wonderful stack of paperwork you just received from escrow regarding your home purchase or refinance here in California, there's likely a form asking you how you would like to take title or "vesting" on the property. The typical response you may hear is to consult with a real estate attorney or CPA, but here's a little cheat sheet so you have an understanding of these terms once you speak to your preferred attorney or CPA, courtesy of our friends at Lawyers Title:

Happy Buying, Selling,and Refi-ing!

Caroline Choi Real Estate

Caroline Sells The City LA

www.CarolineSellsTheCity.com

The Difference between a Full Condo Review and Limited Condo Review

Thinking about buying or selling a condo? While HOA docs are ordered for the buyer to review, a buyer's lender will also take interest in the HOA and what the HOA might have going on.

In these financed transactions, the lender will either conduct a full condo review or limited condo review. What's the difference? A full condo review is much more comprehensive than a limited condo review, and all documents regarding budgets, HOA financials, meetings, reserve studies, by-laws, articles of incorporation, CC&Rs, as well as an HOA questionnaire are required. Sounds like a lot, right?

In a limited condo review, there are usually only 2 requirements: that the HOA is not in litigation, and the HOA must carry sufficient insurance. Sounds a lot easier, huh?

So how do you know if you need a full or limited condo review? It will vary amongst different lenders, but here's a guideline passed along by Prospect Mortgage:

Primary Residence – as long as buyer is putting at least 20% down, then only a LIMITED review is required.

Second Home – as long as buyer is putting at least 25% down, then only a LIMITED review is required

Investment/Rental property – FULL review required regardless of down payment

Consult with your lender to see which they may require, but knowledge is power and hopefully this gave you a bit more information about the condo buying/selling process in general.

Happy Buying and Selling!

Caroline Choi Real Estate
Caroline Sells The City LA
www.CarolineSellsTheCity.com

DTLA Events for April 2013

Live, work, or play Downtown and wondering what there's to do this April as the weather warms up? Here's a great list of happenings going on this month in DTLA, including concerts, readings, theater performances, and shopping in the area:

http://www.downtownla.com/0_02_calendar.asp

So if you're looking for things to do, DTLA is the place! Go explore!

Caroline Choi Real Estate
Caroline Sells The City LA
www.CarolineSellsTheCity.com

Take the Downtown LA 2013 Demographic Survey!

Do you live, work, or play Downtown? If you do, take the Downtown LA Demographic Survey! This important survey gives the Downtown Business Improvement District a better idea of the needs and wants of Downtown-goers, and actually brought the area a number of restaurants, along with Target to the 7th & Fig complex. NOT BAD!

So take your survey here and put in your two cents:
http://www.downtownla.com/survey-2013-open.asp?utm_source=DowntownLA.com&utm_medium=Email&utm_campaign=Survey%2B2013

Polls close April 14th, 2013, so you still have time. Go, go, go!

Happy Surveying!

Caroline Choi Real Estate
Caroline Sells The City LA
www.CarolineSellsTheCity.com

What is Escrow?

For those of us in real estate, we throw around a lot of terms, and sometimes, those terms may not be clear to people who have not been through the escrow or home buying or selling process, such as first time buyers. Keep in mind that other states may use attorneys to close their transactions, but here in California, we use escrow holders.

Escrow is essentially a term we use to say "we're in the process of making this deal happen", and also referred to as the actual third party who handles the transaction from seller to buyer. Here's a list of some of the items escrow handles on behalf of the parties involved:

Happy Buying and Selling!

Caroline Choi Real Estate
Caroline Sells The City LA
www.CarolineSellsTheCity.com