How fast will I use up my equity with a Home Equity Conversion Mortgage(HECM)?

This is a question I had to know the answer.  If your not making a mortgage payment and every month a little of your equity is getting used up… how long does that take? And what happens if the loan becomes upside down?  Do I have to pay it back?

Listen and find out – your gonna love what you discover with me.

Why should I consider a Reverse Mortgage?

A reverse mortgage, also called a Home Equity Conversion Mortgage (HECM), uses the equity you already have in your home to re-finance and eliminate your mortgage payment; for as long as you (and your spouse) live in your home.  It also lets you purchase a home by letting you access some of the homes value to never have a mortgage payment again.  This loan requires one person to be a min of 62 years of age.  It can create financial comfort and ease by eliminating the worry of home mortgage payments.

What is a Home Equity Conversion Mortgage? Is it right for me?

The Home Equity Conversion Mortgage (HECM) program offers people who are a min of 62 years of age (actually only one of you needs to be 62) the opportunity to purchase your home with as little as 40% cash down payment and never make a mortgage payment again.

This can make getting your dream retirement home a reality.  You won’t need to put all your cash into the purchase of your home.  Leaving you with more for living.

I sit down with Jacqui Hamilton a specialist in HECM loans to discuss what they are and the benefits.


Jacqui Hamilton
Concord Mortgage

What do Harvey and Irma mean for your new home construction?

As Irma heads to Florida, Houston is in the early stages of picking up the wet pieces and trying to look forward to sunshine filled and dry days.  

One area that is affected nationwide after a disaster like major Hurricanes is building supplies.

Building time frames will get longer in Arizona, and other states not affected by Harvey and Irma.   

Suppliers prioritize their materials to those locations hit hardest. (and it is mandated by the government that they do)  Builders in other areas and states have delays in their construction due to lack of materials.  This also means that the builders don’t require as many employees to just hang around and wait to swing their hammer.  The combination of lack of materials and fewer on hand workers result in delayed construction build times.  

If you are already contracted with a builder for your new home, plan on your closing date being pushed out.  If you are about to have a builder start your home, and they previously informed you of a 5-7 month build time.  That just got extended to 7-9 months.  

The builder purchase contract has a clause to allow them up to 2 years to get your home built.  Now they don’t want to take that long, but they have the right to.  That clause exists for times like these.

Many of the construction workers will leave states where they have resided and move temporarily to the areas that have been ravaged by nature.  Creating another challenge of not enough construction workers available when the supplies are once again readily available.  

Our prayers and donations are directed to helping so many recover from unimaginable loss.

Real Estate, Real World – Irene Hammond, Making a Niche Work For You

This week on  Real Estate, Real World podcast Marguerite Crespillo interviews Author Irene Hammond.

We discuss specializing in the Active Adult Communities market as a Realtor niche and the new book Retirement Isn’t Boring, When you live in an Active Adult Community.

Here is the podcast link.  Be sure to subscribe for more great information on real estate, marketing and business.



It was so fun having long time realtor and author of the book, “Retirement Isn’t Boring When You Live in an Active Adult Community,” Irene Hammond on the show! She shared some fantastic insight into her real estate specialty, the over 55 communities, and why it has been proven so profitable for her.

Finding a niche can be so beneficial within the real estate industry. It not only sets you apart, but makes you recognizable for buyers and referrals. When you have a specialty that you have truly dug your heels into, learned everything you can about it, and made it known that you are the expert it makes marketing to your desired cliental that much simpler. Irene found her niche within active adult communities during a time that they were only beginning to take form and no one had really dove into this specialty. 15 years later, she has accumulated so much knowledge and experience within her niche that she was able to write a book!

I think for most of us the common misperception of retirement communities is the idea that it would be boring, when in reality they are probably more active socially than we are! From travel, activities, and constant interaction with friends and neighbors within your same walk of life, these seniors find themselves busier than ever before!  Ultimately, this purchase not only means a new home, but signifies a new lifestyle. This type of relocation comes at a time in your life when you are no longer moving with your family in mind…you are LIVING with yourself and your own interests in mind! That’s the dream!

In her book, Irene answers all the questions she typically receives from buyers and also gives all the basic information an agent would need in order to better serve their 55+ clients. It is the perfect resource! I highly recommend you give her book a read and this podcast a listen so you too can find out how to better serve your clients and possibly yourself one day!

Show Features

Here are some of the key takeaways from this episode.

  • The Value of Finding Your Niche
  • Why 55+ Communities Have Easy Transactions
  • How to Make Clients Come to You
  • The Importance of Catering Your Business to Your Strengths


Why do you care if your home inspector is an ASHI Member?

ASHI home inspector logo

ASHI is the American Society of Home Inspectors.  Even though the state of Arizona has based the standards for home inspectors on the ASHI standards, an ASHI Home Inspector has a higher level of experience. 

The Arizona State Licensing requires 30 inspections with  an experienced licensed inspector.  ASHI requires the Home Inspectors to have 250 inspections “under their belt” before they can become ASHI Certified. 

So an ASHI Certified Home Inspector is guaranteed to have more experience than a newly licensed inspector. 

What is NOT included in my Home Inspection?

Understanding what is, and isn’t included in your home inspection is important for you the buyer. Your home inspector is going to inspect


That seems like the whole house… and all the main items… but there are items that the Home Inspector is not required to inspect or include on the inspection report.

Irrigation Systems
Low Voltage
Telephone Systems
Remote Controls
Soil Conditions
Water Softners
Fire Sprinklers
Chinese Drywall
Smoke Detectors
Anything That Can’t be Seen

So lets start at the top of this list… and discover what and why for these items.

  • Irrigations systems – for a home inspector to check the entire system would take soooo much time, each drip line at each plant, and each of the timers and systems are not standardized.
    • Good news, most home inspectors if they visually see a problem with plants dying, sinking spots in the ground or around a sprinkler head will let you know about it on their report
  • Low Voltage – this is low voltage lighting, or other low voltage systems
  • Telephone Systems – most are privately owned
    • Good News – add insurance on your phone services and they phone company will replace any faulty lines for you
  • Remote Controls – have you tried to figure out all those remote controls?
  • Mold – The home inspector will let you know if they find mold, they just won’t identify the type of mold, that requires an expert!
  • Soil Conditions – This again requires an expert.  If soil condition is important to you, you will need to hire a specialist.
  • Fountains – I know, lots of homes have them, but they are not required to be inspected by the home inspector.  So many are not filled with water and are not connected to power, sometime because it doesn’t work, sometimes because the seller has drained it as they are not residing in the home and using it.
  • Water Softeners – We have really hard water in Arizona, and many many homes have water softeners.  Some are owned and others are rental systems.  Kind of like fountains, they are not all ‘turned on’ and ready for use.
  • Fire Sprinklers – Duh, you really don’t want those tested
    • they will let you know if the fire sprinkler heads have been recalled
  • Chinese Drywall – this stuff is nasty – it can release toxic gases – however it has been drywalled and mudded in so the inspector can’t “see” if the drywall is Chinese made or US made.
    • if the home inspector sees exposed drywall and identifies it as Chinese made they will disclose it on your inspection report
  • Smoke Detectors – have you taken the beeping battery out of yours?  Lots of homes smoke detectors have had the battery removed, to test them, the home inspector would need to install batteries in nearly every unit.
    • you can replace a smoke detector for as little as $10 give or take
  • Anything That Can’t Be Seen – so that wall unit of bookshelves could be blocking a hole in the drywall, a dead electrical plug or stains in the carpet… and the home inspector is not going to be moving boxes or furnishings to access what it is blocking.

Predictions for the Greater Phoenix Real Estate Market

This is a portion of an article written by our broker, Jim Sexton in the Arizona Journal of Real Estate and Business for December.   The first half of the article deals with variables to be resolved post election by the president.   Jim’s predictions follow:

 “2012 will have around 90,000 sales reported by ARMLS, which will be a 10-12% drop from 2011 numbers, but the overall dollar volume of those sales will be up almost 6% from 2011.  The average price per square foot will be up over 13% for 2012.  Using these trends, I believe that the number of sales in 2013 will remain around 90,000, although if I could give a range it would be 85,000-95,000 sales for the year.  I think prices will continue to bounce back.  I don’t expect another 13% increase, but I see a price improvement in the 5-8% range.  I expect active inventory to rise from the current less than 3 month supply to the more balanced 3-4 month supply.  Both short sales and REOs

will continue to decrease.  Distressed properties made up 70% of the market 2 years ago, 65% 1 year ago and currently are at 41%.  Look for that downward trend to continue to under 30%, with REOs below 10% and short sales dropping to around 20%.  Also expect to see Arizona’s population continue to grow and the building industry in Phoenix ‘rise from the ashes’.  Both will continue the positive steps we’ve seen to our economic recovery for the region.”

Based on Jim’s experience, knowledge and his great batting average we are expecting that 2013 will be a successful and positive year for real estate in our Valley of the Sun.


How the “fiscal cliff” might impact you as a home seller.

How the “fiscal cliff” might impact you as a home seller.

One of the “Bush tax cuts” that might be falling off the cliff could hurt you as a home seller.  Until Dec 31, 2012  the formula for paying tax on the sale of your principal residence is very favorable.

You take the ‘basis’ which is what you paid for the home initially plus major improvements you have made. (my very simplified explanation)   Then subtract that ‘basis’ from today’s sale price.  We think of that as profit on the sale.  The existing tax break lets you take $250k off that profit if you are single and $500k if you are married (again simplified).  The overage remaining is taxed as a capital gain, the rate depending  on your tax bracket.

If that tax cut falls off the cliff, you will be paying capital gains tax on the entire proceeds over your ‘basis’.  There will be no more $250k or $500k reduction.  There is to be a raise in the capital gains tax from 15% to 25% (% is variable per your tax bracket).   Plus there is a new medicare tax of 3.8% on capital gains.

PLEASE understand that my explanation is super simplified !

There are so many ins and outs and dozens of pages in the IRS books defining this formula that only your tax person will understand it fully.   I am in no way qualified to explain more than the simplified basics to you.  My purpose is to give you a heads up for your future home buying plans if they depend upon the proceeds from the sale of your existing home and to make the strong suggestion that you have a meeting with your tax person at your soonest.



How much, below asking price will the typical seller accept on the sale of their home?


Recently I had a really great question asked by a client of mine, they asked me how much a seller is willing to sell their home for, less than asking price? That’s a great question to start the answer is no seller is typical.

Every seller has a different reason for selling; every person selling their home is in a different financial position. We can ask the listing agent and get an idea of some of these things we can take a look at the price that they purchased home for and if they financed, how much they financed. This will give us an idea of where the seller is before the have to dig deep into their pockets or be in a short sale position.

The more important question is to ask what is the market and the market conditions telling you about where homes are selling.

· you need to consider the purchase price of the home you’re looking at

· the neighborhood the home is in

· as well as the sellers and what did they purchase the home for and was it financed

These items together will give a little better idea of where to start with your offer. ~ Copyright © 2005 ~ All Rights Reserved