This photo was recently sent to me courtesy of one of my all-time favorite home inspectors in the greater Phoenix metro area, Josh Lutz.  He spotted the momma brown recluse spider (with babies on board) sitting on his shoe during a home inspection at a house in Gilbert, and after having a small heart attack managed to snap a picture of it.  I’m not sure I would have had the composure to handle it as well as Josh did, but I very much appreciate the photo!

So why on earth would I post it here in the Gilbert Real Estate Blog?  Because even though personal encounters with brown recluse spiders are relatively uncommon in this area, they do happen.  The important detail in this case is that the home inspector was able to report the sighting of the critter so that the prospective buyer of the home – with a warning that immediately upon closing escrow the new owners should perform a good pest control treatment.

The same goes for warnings about other desert critters, like scorpions, snakes, crickets, black widow spiders, lizards, etc. It’s honestly not realistic to think that humans have overtaken the desert here in the Phoenix area and have wiped out all the desert critters.  My standard line to clients is, “We live in the desert – don’t forget it.” But with appropriate precautions, it’s very easy to co-exist with them.

No need to panic or develop phobias.  Just be aware.

The purpose of this post is to update you on a previous post of mine from November of 2010 in which I defined the then-current mortgage loan pre-approval process in Arizona.  The new (effective February 28, 2011) terminology and form(s) have been released, so let the games begin!

Replacing the former Loan Status Report (LSR) is the Pre-Qualification Form.  The purpose of the new form, according to the Arizona Association of REALTORS®, is

“to provide information on the buyer’s ability to qualify for a loan without a Good Faith Estimate (GFE)”

Say what?!?! A GFE is a document issued to a home buyer by a lender that details the fees and costs associated with their mortgage loan, monthly payment, interest rate, etc.  But it’s also a document that is typically considered confidential between the lender and the home buyer.  The new Pre-Qualification Form requires the lender to furnish a LOT of additional information about the buyer, type of loan, amount of loan, interest rate, etc., and thus can provide a great way of evidencing to a seller that the buyer is indeed pre-qualified for the mortgage loan.

The proper use of the Pre-Qualification Form is that it should be attached to a 2011 AAR Residential Real Estate Resale Purchase Contract whenever a home buyer submits an offer on a residential property.  Here are a few highlights of the new form:

• The form is NOT property specific, meaning it can be issued without naming any certain property address.
• The form is to be completed and signed by the mortgage lender (loan officer), including their Arizona License number and NMLS number.
• The form is to disclose the marital status of the buyer(s), primarily because Arizona is a community property state and marital status can create contract issues and title requirements.
• The form is to disclose the property type, since different types require different loan programs, criteria and documentation.  A good example would be the difference between a loan for a single family detached house and a loan for a mobile home – the differences between the two loan programs are HUGE.
• The form is to disclose the maximum total monthly housing payment, loan amount and interest rate for which the buyer is pre-qualified.
• The form is to include an expiration, which is typically when the buyer’s credit report expires.
• The form is to be signed by the home buyer(s), which is basically granting permission for the buyer’s broker to submit the form with the offer/contract.  It also authorizes and instructs the lender to issue a Loan Status Update (LSU) to the seller and broker(s) within 5 calendar days of contract acceptance.

As I stated in my post in November 2010, my biggest beef with the Pre-Qualification Form is the form title itself, not the content.  That may seem petty to some of you, but for as many years as I can remember, the term ‘pre-qualification’ has always implied a quick, easy, over-the-phone activity with no application or documentation from the buyer.  But make no bones about it - this new Pre-Qualification Form requests and requires substantial documentation and commitment from the buyer and lender, and in my estimation is a giant leap forward in the world of residential Gilbert real estate and mortgage lending.

Of course, I’m always open to comments, supportive or dissenting.      What say ye, my friends?

Greater Phoenix Market Conditions

Greater Phoenix Market Conditions

I’m always extremely cautious about using real estate “averages”, as they can and do often skew the true picture of individual communities and areas. Nevertheless, there are a couple of points that are worth noting in the above charts.

It’s interesting that normally at this time of year we experience an increase in listings – and yet the past 2 months has seen a decrease in listings. Anybody care to speculate on the reason(s) for this anomaly?

The next observation is that the greater Phoenix market is holding fairly steadily in the number of Active listings as well as sales.

Additionally, at roughly 4.5 months inventory, the greater Phoenix market appears to be showing some consistent stabilization.  As always, time will tell.

NOTE:  The information and statistics contained in the above charts are deemed reliable, but not guaranteed. If you’re contemplating a major financial decision regarding residential real estate, please do yourself a huge favor and consult with a reputable real estate broker, attorney and/or accountant.