Yajnesh Rai

74 Arrested After Wire Fraud Investigation | Realtor Magazine

Federal authorities announced Monday that an investigation resulted in 74 arrests of people in the U.S. and overseas who allegedly took part in schemes to intercept wire transfers from businesses and individuals, including in real estate transactions. Federal authorities seized nearly $2.4 million and recovered about $14 million in fraudulent wire transfers. 

The arrests were made as part of a six-month investigation, dubbed Operation Wire Wire, that was coordinated by a multiagency task force, including the U.S. Department of Justice, U.S. Department of Homeland Security, U.S. Department of Treasury, and U.S. Postal Inspection Service. Over the last two weeks, the agencies have arrested 42 people in the U.S., 29 in Nigeria, and three in Canada, Mauritius, and Poland. 

The agencies investigated “Business Email Compromise” schemes, where hackers attempt to gain access to email accounts of employees. The scams also involved some real estate transactions. For example, a hacker pretends to be a real estate professional, gains access to the person’s email account, and requests that real estate buyers wire their funds unknowingly to fraudulent accounts. Two years ago, the National Association of REALTORS® and the Federal Trade Commission issued a warning to real estate professionals and consumers that scammers were attempting to pose as real estate professionals and title insurance companies to try to dupe them out of their down payment and closing costs.

The Threat of Wire Fraud is Real

Among the recent arrests, a 25-year-old Fort Lauderdale, Fla., man was detained because he is accused of gaining access to email accounts belonging to a Massachusetts real estate attorney and sending emails to recipients that “spoofed” the attorney’s account. In one case, the man allegedly instructed an email recipient to transfer nearly $500,000—that was intended to be used for a payment in a real estate transaction—to a fraudulent account.

“Fraudsters can rob people of their life’s savings in a matter of minutes,” Attorney General Jeff Sessions said in a statement. “These are malicious and morally repugnant crimes. The Department of Justice has taken aggressive action against fraudsters in recent months, conducting the largest sweep of fraud against American seniors in history back in February. … We will continue to go on offense against fraudsters so that the American people can have safety and peace of mind.” 

3 Tenant Screening Checks Landlords Fail to Do | Realtor Magazine

Tenant screening is more than a credit or background check. But many landlords are failing to gather critical documentation that could help avoid approving tenants who later default on their rent, need to be evicted, or have other problems that cut into a landlord’s profitability, according to a new survey by the American Apartment Owners Association of more than 1,100 of its members. 

Thirty-seven percent of landlords fail to collect paycheck stubs; 67 percent don’t ask for Social Security cards; and 20 percent never ask to see a driver’s license, the survey found. But all three are critical to screening tenants and avoiding losing “thousands” in lost rent, the AAOA says in its report. 

The AAOA urges landlords to collect paycheck stubs to help determine if the tenant can really afford the rent. “The lower their debt-to-income ratio, the higher the risk of a tenant defaulting on rent,” the AAOA notes in its report. 

Further, the AAOA notes that a Social Security card remains the best form of identification. It shows the state in which it was issued and the tenant’s legal name. “Most importantly, should your tenant skip town and leave owing you rent, you will have a much higher chance of collecting that debt through a collection agency if you have [their] Social Security number,” the report notes. “In many cases, you can also use the [number] to trace the tenant’s new whereabouts to serve them a court summons as well.” 

Likewise, a driver’s license also provides another layer of identification, including the date of birth and their most recent address. “These pieces of information are crucial when conducting a criminal and eviction background search,” the report says. 

Homeowner Equity Growth Streak Continues | Realtor Magazine

Homeowners with a mortgage saw their equity rise 13.3 percent year over year, according to CoreLogic’s Home Equity Report for the first quarter of 2018, released Thursday. The average homeowner gained $16,300 in home equity between the first quarter of 2017 and the first quarter of 2018. That is the highest growth in home equity in four years. 

“Home-price growth has accelerated in recent months, helping to build home-equity wealth and lift underwater homeowners back into positive equity,” says Frank Nothaft, CoreLogic’s chief economist. 

Western states saw the largest uptick in home equity. California homeowners gained $51,000 on average in home equity, while Washington homeowners saw about $44,000 on average, in equity.

“Home equity balances continue to grow across the nation,” says Frank Martell, president and CEO of CoreLogic. “In the far Western states, equity gains are fueled by a long run in the home price escalation. With strong economic growth and higher purchase demand, we expect these trends to continue for the foreseeable future.” 

Is Break in Rate Hikes Significant to Buyers? | Realtor Magazine

For the second consecutive week, mortgage rates decreased as the 30-year fixed-rate mortgage fell two basis points to average 4.54 percent, Freddie Mac reports. Rates had been on a steady incline for weeks before breaking trend.

“Home buyers have taken advantage of the recent moderation in rates, which led to a 4 percent increase in purchase applications last week,” said Sam Khater, Freddie Mac’s chief economist. “Although demand has remained steadfast against the backdrop of this year’s higher borrowing costs, it’s important to note that the growth rate of purchase loan balances has moderated so far this year—and particularly since March. This slowdown indicates that buyers are having difficulty stretching to keep up with the pace of home price growth. … Listings for new and existing homes need to increase in the months ahead to moderate price growth and reignite sales activity.” 

Freddie Mac reports the following national averages with mortgage rates for the week ending June 7: 

• 30-year fixed-rate mortgages: averaged 4.54 percent, with an average 0.5 point, dropping from last week’s 4.56 percent average. Last year at this time, 30-year rates averaged 3.89 percent. 
• 15-year fixed-rate mortgages: averaged 4.01 percent, with an average 0.4 point, falling from last week’s 4.06 percent average. A year ago, 15-year rates averaged 3.16 percent. 
• 5-year hybrid adjustable-rate mortgages: averaged 3.74 percent, with an average 0.4 point, falling from last week’s 3.80 percent average. A year ago, 5-year ARMs averaged 3.11 percent. 

Loan Demand Surges on Lower Rates | Realtor Magazine

Mortgage applications reversed course and posted an increase last week, as homeowners and home purchasers sought to take advantage of the lowest rates in six weeks. Mortgage application volume—for home purchases and refinance applications—rose 4.1 percent last week on a seasonally adjusted week-over-week basis, the Mortgage Bankers Association reported Wednesday. Volume, however, is still 2 percent lower than a year ago. 

Broken out, applications to refinance rose 4 percent last week, but remain 17 percent lower than a year ago, when interest rates were much lower. Applications to purchase a home also rose 4 percent last week and are now 9 percent higher than a year ago. 

The average 30-year fixed-rate mortgage fell to 4.75 percent last week, after averaging 4.84 percent the week prior. This marks the lowest rate since the week ending April 20, the Mortgage Bankers Association reports. Mortgage rates loosely follow the 10-year Treasury bond yield. 

“Concerns over Italy’s political turmoil and questions about the possible imposition of trade tariffs by the U.S. on its major trade partners pushed Treasury rates lower this week,” says Joel Kan, an MBA economist. “While the level of refinance activity remains historically low, the reprieve in rate increases may have stopped the slide.”

Mortgage rates did start to move higher again as this week began. More buyers are turning to adjustable-rate mortgages due to the overall rise in rates over the past year. The share of ARMs increased to 7.1 percent of total mortgage applications, the MBA reports.

“While rates are like any other financial instrument whose future can’t be predicted, they do tend to pause and congregate at some levels more than others,” Matthew Graham, chief operating officer at Mortgage News Daily, told CNBC. “We’ll often see rising rates repeatedly run into a ceiling that goes on to become a floor in the future.”

Homeownership Still Vital to Build Wealth | Realtor Magazine

Homeownership remains a major component to financial security and continues to be the largest asset of the majority of households in the U.S. Primary residences account for a quarter of all household wealth, according to data from the Board of Governors of the Federal Reserve System’s Survey of Consumer Finances. 

“Homeownership is a primary source of net worth for many Americans, and is an important step in accumulating personal financial assets over the long term,” says Randy Noel, chairman of the National Association of Home Builders.

In the fourth quarter of 2017, households in the U.S. saw a record $14.4 trillion of equity in their homes. However, the homeownership rate in recent years has slipped below its 25-year average. In the fourth quarter, it was at 64.2 percent compared to its historical average of 66.3 percent. 

“We must continue to address the obstacles that remain for many potential home buyers,” Noel says.

June marks National Homeownership Month, and REALTOR® associations are reinforcing their commitment to protection homeownership and making it more affordable, attainable, and sustainable.

“REALTORS® pledge to continue to lead efforts that the dream of homeownership is not only possible, but very real, for any and all who want to achieve it, so they can have a place of their own to make memories, start growing their financial future, and build strong communities,” says Elizabeth Mendenhall, president of the National Association of REALTORS®. For resources to mark National Homeownership Month, visit NAR’s Homeownership Matters.

First-Time Buyers Account for More Mortgages | Realtor Magazine

First-time home buyers are flocking to the real estate market in larger numbers, comprising 46 percent of mortgages backed by Freddie Mac—excluding refinancings—that were issued in the first quarter of this year. That marks the largest quarterly share that Freddie Mac has recorded, dating back to 2012. 

“This is a millennial-driven rise,” Sam Khater, Freddie Mac’s chief economist, told Bloomberg. “You’ve got a strong economy that’s helping, along with the appetite of the financial market to invest in mortgages.” 

Younger buyers may be motivated to buy due to the easing of credit in recent months as well as an improving job market. They also may be motivated to buy as rents rise and as increasing home prices and mortgage costs threaten to price them out of homeownership if they don’t act soon, Bloomberg reports. 

The National Association of REALTORS® reports that the median age of first-time buyers is 32 years old. 

The Counteroffer: Negotiating a Real Estate Deal

Buying a home is rarely as simple as making an offer and paying that offer out. Negotiations can go back and forth for weeks before the seller and buyer are both satisfied.

The vehicle for this negotiation is the counteroffer — a vital and complex rejection and counter to an offer made by either party. Counteroffers are typically handled between real estate agents and are time sensitive.

Selling or buying a home is more of a process than a transaction, so it’s important to understand counteroffers before you make your first offer.

Why was I countered?

As a home buyer, if you make an offer below list price, the seller may choose to reject, accept or simply let the offer expire. If there are multiple offers, the listing agent will lay out the options for their client and then notify all buyers’ agents of the choices.

Sellers may also counter your proposed closing date. If they need to move out quickly, they may want to push it earlier. They may also ask to rent the property for a time after the settlement.

Price and closing date negotiations are common from both parties, but there are even more reasons sellers can potentially get countered.

The condition of the home is likely the biggest factor here. As home buyers conduct ongoing research into the home, any problems with the condition of the house can result in a counteroffer.

If you’ve chosen to take appliances with you when you move, buyers may also look to negotiate for those.

Appraisals are another reason for counteroffers. If an appraisal comes in below the agreed-upon sale price, it will affect the amount the mortgage company will lend to the buyer.

Negotiation power

When reviewing a counteroffer, it’s important to have an experienced real estate agent who can capitalize on your advantages in a negotiation. Both sellers and buyers can take steps to put themselves in an advantageous position through planning and smart counteroffers.

Knowledge is power in negotiations, so try to glean as much information about the seller or buyer as you can. Your agent will also seek information from the other agent on your behalf.

Sometimes sellers use the pending sale of their home to finance another, meaning they have a truncated timeline and could be more eager to make a deal. Similarly, buyers who have terminated a lease may be desperate for a place to live and more willing to negotiate.

If you’re selling a home with known issues, anticipate how these problems may put you at a disadvantage during negotiations. A leaky roof may not be discovered until after buyers order a home inspection. Depending on the cost, they may ask the seller to either fix the roof or deduct the cost of a new roof from the sale price.

These types of issues put sellers at a distinct disadvantage because they have to either pay for repairs, lower the selling price, or reject the counteroffer and hope the next buyer doesn’t notice or care about repairs.

This is why it’s worth the money (around $500) to pay for an inspection before listing a house. Preparation can save you headaches and money down the road.

Responding to a counteroffer

If you’ve received a counteroffer as a buyer or a seller, carefully review every aspect. Real estate agents, apart from yours, are under no obligation to ensure you read the full contract. So make sure you read everything carefully before you sign.

With each individual counteroffer, consider every aspect of the sale, including old and new information. If you made an offer above the list price, there is always the possibility for an appraisal to come in low.

If you are responding to a counteroffer before an appraisal or inspection, keep those at the forefront of your mind. Prepare yourself for future counteroffers once they are completed.

Whether you’re selling or buying a home, establish a baseline for when you will walk away from a sale. As a buyer, you don’t want to spend so much on a home that you move in with no cash for improvements and repairs. And as a seller, you should know how much you want to make off the sale.

With a measured and informed approach, counteroffers can be your friend. Communicate often with your agent to let them know what you want from the sale, and never be afraid to walk away if things go south.

Redfin Housing Demand Index Posted Slight Decline from March to April Amid Ongoing Inventory Crunch – @Redfin

The Redfin Housing Demand Index fell 1.3 percent month over month to 106 in April, the third consecutive month of declines.

The Demand Index is based on thousands of Redfin customers requesting home tours and writing offers. The Demand Index is adjusted for Redfin’s market share growth. A level of 100 represents the historical average for the three-year period from January 2013 to December 2015

“April was the first time in 27 months that we saw a year-over-year decline in the number of customers touring homes,” said Redfin chief economist Nela Richardson. “We believe this was driven by the low levels of new listings in March. However, April’s 6.6 percent increase in new listings is a positive turn for homebuyers and bodes well for May and June home sales.”

From March to April, the seasonally adjusted number of buyers requesting home tours dropped 1.4 percent, while the number of buyers making offers fell 1.8 percent.

Looking at year-over-year comparisons, the Demand Index declined 11.5 percent from April 2017. The number of buyers requesting home tours dropped 3.7 percent year over year, and the number of buyers making offers fell 22.1 percent.

Across the 15 metros covered by the Demand Index, the number of homes for sale fell 7.3 percent year over year in April, the 35th consecutive month of falling supply. However, newly listed homes for sale increased 6.6 percent in April compared to a year earlier.

13 Simple Steps to Prep Your Home for the Best Summer Ever

Summer will be here before you know it, and you know what that means: Heat, hornets and yard work.

If you’re starting to miss spring already, fear not. Here are some quick projects to make your home and garden more comfortable and cost-effective this summer.

Inside the house

• Service the air conditioning. Nothing can ruin your day like a broken air-conditioning unit on a summer day, so keep it running smoothly by servicing it every spring. Every three months, change the filter, flush out drain lines with a cup of bleach, and ensure that the outdoor unit has room to breathe by keeping vegetation about an arm’s length away.
• Replace smoke detector batteries. You’d be surprised at how much peace of mind you’ll get after knocking out this one little chore. Change all the batteries on the same day and remind yourself to do it again in six months. If your smoke alarms were manufactured 10 or more years ago, replace them entirely.
• Rotate ceiling fan blades. Your ceiling fan may have a switch that changes the direction in which the blades turn. If so, make sure that the blades are spinning counterclockwise and pushing air down, rather than up.
• Clean behind appliances. You’ve been putting it off for far too long. You’re terrified of the horrors that await in the shadows of your kitchen, but it’s time to put on some gloves, arm yourself with disinfectant cleaner and roll out the oven with a brave face.
• Clean dryer vents. If your clothes come out of the dryer damp and musty lately, it’s probably because the vent is clogged with lint — not only wasting energy, but posing a significant fire risk. To do it right the first time, purchase a vent-cleaning kit. Its flexible rod and brush attaches to your drill and will extract a puppy-sized mass of lint in no time.
• Upgrade your thermostat. Replacing your existing thermostat with a ‘smart’ model does more than save you money. They respond to your voice, divert cool air to occupied rooms, can be operated from your phone and might even give you a weather forecast at a glance before work.
• Repot houseplants. Give houseplants fresh potting mix in spring when they’re actively growing. Slip the mass of roots and potting mix out of the pot, gently tease apart the roots, remove rotted pieces and replace it with fresh and fertile potting mix. If the leaves are turning pale from too much direct summer sun, move them to a slightly shadier place.

Out in the yard

• Patch your lawn. If you wait too long to plant new grass seeds or sod, aggressive weeds will happily fill the gaps for you. Luckily, grass will quickly establish if you remove all existing weeds beforehand, amend with topsoil and keep the area irrigated for the first week or two.
• Inspect gutters and downspouts. Fall isn’t the only time to clean out the gutters, especially if you have messy trees nearby. Make sure that the gutters are soundly attached to your roof, seal any gaps with silicone caulk and remove any obstructions at the base of the downspout.
• Inspect sprinklers. If you notice any clogged or broken sprinkler heads, shut off the water and dig a 2-inch diameter hole around the head. Unscrew the head from its riser and replace with a new one. If the head is merely clogged, remove the basket and rinse both it and the head in clean water. Reassemble the head and screw it onto the riser.
• Get your mower up and running. Give your mower, string trimmer and other lawn equipment some TLC before the summer mowing season begins. After removing the spark plug, replace the air filters, change the oil, sharpen blades and give your equipment a good cleaning.
• Remove hornet nests. If you have hornets, yellow jackets and paper wasps around your home, take steps to remove them now before they form a large, aggressive colony. You can play it safe by calling a professional, or spray nests at night when they’re less active. Just be sure to wear protective eyewear, a mask, pants and long sleeves.
• Clean the grill. Prevent flare-ups and cooking fires by giving your grill a good cleaning. Ideally you’d clean after every use, but you can start fresh with a grill brush, nozzle and wet rag. Now is also a good time to stock up on charcoal and make sure your tools are ready for grilling season.