1. Why Do Dannecker & Associates properties sell so fast? Do you position them too low amongst the competition?
Definitely Not! The reality is that most our listings sell at or above full price. We are professionals and it is our business to know the market, do the necessary research and analyze what this means for you. We present the research to you and come up with an initial market position that we agree upon.
Our homes typically sell twice as fast because of our effective marketing strategies. We always do an analysis of the supply of competition in your homes price range, study how fast the market is absorbing the supply and determine a position that will make the property enticing to buyers. Positioning your property ahead of the competition will bring you more buyers, more excitement and more offers.
2. Couldn’t We Try Listing At Our Price For a Couple of Weeks?
If the initial price you want to list at agrees with the market research then the answer is yes. If your price defies all market research, then studies show you will lose time and money.
The majority of buyer activity on a listing occurs in the first 30 days. The busiest period of a new listing is usually day 5 through day 13 because the buyers receive an email from their agent about the new listing on day 1 or 2 and then have to schedule the appointment for a time that works for both them and the seller. If you want the multitude of buyers to come and immediately disagree with you market positioning, you will lose their interest almost immediately. A common attitude with buyers in this situation is that they will wait to see if your home is still on the market in a few months and then maybe they’ll make a lowball offer. Again, you lose…
Mortgage Loan FAQ’s
1. What type of documentation will I need for my mortgage loan application?
Having these documents on hand when you contact the mortgage company will help make the application process easier:
- Your purchase contract for the home.
- Your bank account numbers, the address of your bank branch and statements for the previous 2-3 months.
- Pay stubs, W2 withholding forms, tax returns for two years, or other proof of employment and income.
- Recent credit card bills or canceled checks for rent or utility bill payments.
- Information on other consumer debt such as car loans, furniture loans, student loans and retail credit cards.
- If you are self employed, you will need to provide a profit and loss statement, balance sheet and complete tax return.
- If you are using a gift from someone to help pay the down payment and/or closing costs, bring a letter stating that the money is a gift and will not have to be repaid.
2. What is a FICO score?
A FICO score is the most common method lenders use to determine a loan applicant’s credit risk. Scores range from 350 (high risk) to 850 (low risk). Credit scores only consider the information contained in your credit profile. They do not consider your income, savings, down payment amount, or demographic factors. Past delinquencies, slow payments, current debt level, length of credit history, types of credit and number of inquiries are all considered in credit scores. There are some things you can do to improve your FICO score before applying for a mortgage loan. Contact us for more information on ways to improve your FICO score.
We recommend MetroTrust Mortgage for purchasing San Diego properties.
Tax Assessment FAQ’s
The following information has been summarized from the website of the San Diego County Assessor/Recorder/Clerk, Gregory J. Smith. For additional information, visit www.sdarcc.com.
3. When is real estate reappraised?
Real property is reappraised when a change-in-ownership occurs, or upon completion of new construction. Except for these two instances, property assessments cannot be increased by more than 2% annually, based on the California Consumer Price Index. The property tax rate is 1% plus any bonds, fees, or special charges.
4. What is a Change-in-Ownership Statement?
This confidential statement is used for appraisal purposes and is required by State law to be filed with all property sales and transfers at the time of recording. If it is not filed, a $20 fee is charged and the Assessor’s Office will send out another statement to obtain the required information.
5. How do I get a Homeowners’ Exemption?
If a property is your principal place of residence on January 1, you may apply for an exemption of $7,000 off your assessed value. New property owners automatically receive an exemption application as well as an annual verification of continued eligibility.
6. Is there an assessment exclusion for Seniors and Disabled?
Yes. Propositions 60 and 90 allow qualified disabled people and those 55 years of age or older to buy a residence of equal or lesser value than their existing home and transfer their current taxable value to their new property. See questions 6-9 below to learn more.
7. What are propositions 60 & 90?
Both prop 60 and 90 offer tax relief to people aged 55 or older by exempting them from reassessment when an existing residence is sold and a replacement residence is purchased at an equal or lesser price than the original.
8. What are the qualifications for Prop 60 & 90?
To qualify for the reassessment exemption, the seller of the original residence or the spouse who resides with the seller must be at least 55 years old at the time of sale. The exemption is a one-time-only benefit. The original property must have been eligible for a Homeowner’s Exemption or entitled to a Disabled Veteran’s Exemption and the replacement property must be the owner’s principal residence. The replacement property must be of equal or lesser “current market value” than the original and it must be purchased or constructed within two years (before or after) of the sale of the original property. The county you sell or purchase property in may affect your eligibility. There are other eligibility requirements that must be met, as well. Contact us for more information about Prop 60/90.
9. May I give my original property to a family member and still receive Prop 60 & 90 benefits on my replacement property?
No. The original property must be sold for consideration and be subject to reappraisal at full market value.
10. If I get Prop 60 & 90 benefits must I still file for a Homeowner’s Exemption on the replacement property?
11. What is the Parent/Child Exclusion?
The transfer of real property between parents and children can be excluded from reappraisal for property tax purposes. An application must be filed with the Assessor’s Office to determine eligibility for this exclusion. See questions 12 and 13 below to learn more.
12. What are Propositions 58 & 193?
These propositions offer tax relief by preventing reassessment when real property transfers between a parent and child (Prop 58) or from grandparents to grandchildren (Prop 193), making it easier for Californians to keep property in the family.
13. Who qualifies for Prop 58 & 193 benefits?
For Prop 58: Any child born of the parent(s). Any stepchild of the parent(s) and the spouse of the stepchild while the relationship of stepparent and stepchild exists. Any son- or daughter-in-law of the parent(s). Any stutorily adopted child who was adopted before the age of 18.
The relationship exists until marriage is terminated by divorce, or, if the relationship is terminated by death, untile the remarriage of the surviving son-in-law or daughter-in-law.
For Prop 193: The same relationship requirements for children apply to grandchildren, step-grandchildren and grandchildren-in-law. The parents of the grandchild(ren) who would qualify for a Proposition exclusion from the grandparents must be deceased. There are other eligibility requirements that must be met, as well. Contact us for more information about qualifying for Prop 58/193.
Supplemental Property Tax FAQ’s
14. What are supplemental property taxes?
The Supplemental Real Property Tax Law of 1983 was implemented to aid California’s schools. This supplement is in addition to the regular tax bill, and it is expected to produce over $300 million per year in public education revenue. It requires the Assessor to reappraise property when ownership changes or new construction is completed. The Assessor issues a supplemental assessment that gets prorated based on the number of months remaining in the fiscal year ending June 30.
15. When are supplemental property taxes due?
The supplemental property tax becomes a lien on your property as of the date of ownership change or the date of completion of new construction. Depending on the county’s current workload, you could be billed in as few as three weeks or as many as six months or more.
16. How does the supplemental tax assessment work?
The assessor will appraise your property using a formula that is prorated based on the number of months remaining until June 30, the end of the tax year. You will be advised of the assessment amount and will have the opportunity to discuss your valuation, apply for a homeowner’s exemption (see question 5 above) and be informed of your right to file an assessment appeal. The county will then calculate your supplemental tax and mail you a bill.
17. Can I pay supplemental property taxes in installments?
All supplemental taxes are payable in two equal installments, due on the date the bill is mailed and delinquent on the date specified.
18. If I have an impound account, will the supplemental tax bill be sent to my mortgage company?
No. The supplemental tax bill is sent directly to you by the Tax Collector.
19. If I resell my property again within a few months, will the supplemental tax bill be prorated among the owners?
Yes. If another sale or transfer of the property occurs before the mailing of the supplemental tax bill, the supplemental taxes will be prorated between the owners by the Assessor’s Office.
20. Can I appeal my supplemental tax assessment?
To appeal a supplemental assessment, an application must be filed with the Clerk of the Board within 60 days from the mailing of the tax bill.
For more information, call (858) 505-6262.
21. What if I have more questions about supplemental property taxes?
Or for additional information, please call the San Diego County Assessor’s Office at (858) 505-6262 or visit www.sdarcc.com.
Title Insurance FAQ’s
22. What is a title insurance premium?
The title insurance premium is a one-time fee paid at the close of escrow in California. The issue of who pays closing costs is a matter of agreement between the parties, unless guidelines are specified by a lender or governmental agency, as may be the case with VA or FHA transactions.
23. Why do I need title insurance?
Title insurance provides peace of mind at every stage of the buying process. It offers protection against many risks, including forgery, fraudulent releases, disputed powers of attorney, lack of capacity of a person who has signed a document, ambiguous or erroneous legal descriptions, ambiguous judgment liens, incorrectly indexed public records and federal estate tax liens.
An extended coverage policy can go even further, offering protection against third-party claims regarding adverse possession or past use of land, rights to access adjoining lands or encroachment by neighbors. There is even coverage available against building permit violations and post-policy forgeries and encroachments.
By providing experienced professionals to eliminate risks before closing; insuring against risks that can’t easily be detected; insuring a good closing and even by providing important legal defense, if a problem should arise after the fact.
24. What is escrow?
According Heritage Escrow, “an escrow is the deposit of funds and/or documents with an impartial neutral third party for delivery upon the specific terms and conditions.”
25. Who needs escrow?
You do! Buyers, sellers, lenders and borrowers all have a vested interest in making sure that funds and documents will only change hands once every condition of your transaction has been met. It is the escrow holders obligation to safeguard funds and documents, disbursing funds and conveying title only when provisions of the escrow have been completely fulfilled.
26. Who chooses the escrow holder?
The escrow holder is usually chosen by agreement between the principals. A real estate broker may make a recommendation, but the principals are ultimately responsible for the decision. It is illegal for referral fees to be paid between real estate brokers and escrow companies.
27. What do I have to do during escrow?
Your most important job is to make sure you understand your escrow instructions. As questions about anything you’re unsure about in terms of the instructions, but keep in mind that your escrow officer cannot offer advice about legal or financial issues regarding your transaction.
The second most important thing to do is to follow your instructions quickly and completely. If needed, make sure to provide “good” funds into the escrow account. Personal checks will add additional time to the process.
Finally, be sure to let your escrow officer know as soon as possible about any special needs you might have. Communication is the key to a successful escrow!
28. Should I sign loan documents during escrow?
Some lenders forward their loan docs to escrow for you to sign. If you choose to do so, make sure you are familiar with the process, terms and conditions of the loan since your escrow officer cannot explain or interpret the lender’s documents for you. You may also request a representative from your lender to be present to answer questions at signing, or you can choose to sign loan docs at the lender’s office.
29. What is a closing statement?
A closing statement is a written account of the charges and credits to your account at the time of escrow. Be sure to review your closing papers carefully and ask your escrow officer if you have any questions about the information in them. Save your closing statement for your accountant and for taxes.
30. Can an escrow be cancelled?
Yes, an escrow can be cancelled if a contingency cannot be met or if the parties should disagree during the process. In cases of cancellation, funds on deposit can usually not be released until the escrow holder is in receipt of cancellation instructions that have been mutually agreed upon by both parties. You may be charged a cancellation fee, as well. Ask your escrow company about their policies.
Escrow officers cannot mediate cancellation disputes. If necessary, the escrow holder may allow a court to decide which party is entitled to disputed funds. This is called an interpleader action.
31. What are Mello-Roos?
In a Mello-Roos District, funds for financing public improvements and services are collected through a tax imposed on real property owners. These services may include streets, water, sewage, electricity, infrastructure, schools, museums, parks and police services for newly developing areas. Mello-Roos taxes are equally applied to all properties in the area, regardless of their value. The tax stays in effect as long as it is needed to pay for bonds, interest and administration costs, not to exceed 40 years.
32. How much will my Mello-Roos payment be?
The amount of the Mello-Roos tax may vary yearly, but it may not exceed the maximum amount determined with the district was created. If you purchase a new house with a subdivision, the maximum amount will be outlined in the public report.
33. When will my Mello-Roos payment be due?
Mello-Roos payments are usually collected with your general property tax bill.
34. What is a 1031 tax deferred exchange?
A 1031 tax deferred exchange lets a seller of an investment property to exchange the existing property for a “like” replacement and defer capital gains and depreciation recapture. Such an exchange opens up the possibility of generating income off of money that would have otherwise been paid to the IRS. Contact us for more details on a 1031 tax deferred exchange.
Mold Inspection FAQ’s
35. Why is it important to test for mold?
Mold exposure can cause adverse allergic reactions and can aggravate some existing health conditions. Factors include the type of mold in the home, the degree to which the mold has spread, and the sensitivity of the individual to a particular type of mold.
36. What can be done if mold is suspected in a home?
Mold inspection and testing will help determine the presence of mold, the type of mold that may be present, and the quantity of mold spores that are airborne in the home. There are three major methods of testing for mold:
Swab testing checks for visible mold, mildew or fungus. This test works well for bathrooms and other interior areas where humidity and moisture levels are high.
Air testing determines concentration levels and types of airborne molds in the home. This test works well in the absence of visible molds.
Carpet testing can help determine the presence of mold in carpeting.
Once the presence and type of mold has been determined, there are companies that specialize in the safe removal of existing mold. Ask us for a recommendation.
37. What is the California Mold Disclosure Law?
Need more current info here: The new California mold disclosure law took effect in California on January 1, 2002, but real estate sellers and prospective landlords won’t have to disclose the presence of mold in California homes and buildings to prospective buyers and prospective tenants under the first state law to address growing public fears about mold problems until some future date [probably January 1, 2004] when the State of California publishes both mold contamination and mold remediation standards. The California state government has until July 1, 2003, to establish such standards.
Sellers, real estate brokers and agents, and home inspectors will have to be diligent in following the law. In conforming with the law, the property seller’s transfer disclosure statement—a requirement in real estate transactions since 1985—will now include mold.
In addition, the California State Department of Toxic Substance Control will soon include a chapter on toxic mold in its Environmental Hazards Handbook, which is provided to all buyers and sellers.
Enforcement of mold standards and mold disclosure statements will be done by local governmental agencies under the new mold law.
38. What if I want to buy a home that I suspect may have mold problems?
The seller and realtor are legally obliged to disclose any known information about material defects in the home, so send them both a certified letter asking about any water damage and mold damage history for the house. In that letter, request a short extension in the closing date of the sale so you can hire a company to test the home for mold.