Thus far, statewide, there have been 3,805 foreclosures filed in 2009.  Maui County had 165 foreclosures. This was the worst area in the state, with 1 filing for every 393 properties; down 3.5% from May, but up 511% from June 2008.  Kauai County had 69 foreclosures, which is 1 filing for every 423 properties; down 11.5% from May, but up 360% from June 2008. The Big Island had 176 foreclosures, which is 1 filing for every 441 properties; up 5% from May, and up 935% from June 2008. The city and county of Honolulu had 296 foreclosures, which is 1 for every 1,131 properties; down 26% from May, but up 295% from June 2008.  We may now be seeing a peak in Hawaii’s foreclosure market. If so, then this is an optimal time to look for good buying opportunities.

Here are some key points to consider when buying foreclosed properties. The overall depreciation in Hawaii’s real estate market has increased the number of sales to first-time home buyers, who previously had been priced out of the market. Foreclosure prices are often significantly lower than the original loan on the home because, banks usually price foreclosures to sell quickly, and foreclosure prices don’t reflect any emotional attachments to the home. Foreclosures may be sold “as is” and without some of the traditional disclosure statements, warranties, and other documentation that serve to protect buyers in a conventional home sale. So be thorough with your research and inspect the home carefully to avoid any unanticipated costs.

If you need assistance in your search for a home contact a Hawaii Life Real Estate Agent.

 

*Numbers from RealtyTrac; includes commercial properties (e.g., time shares).

Related posts:

1. Act 48 – Will this Foreclosure Law Ruin the Hawaii Market?
2. The Mortgage Foreclosure Dispute Resolution – Foreclosure Mediation in Hawaii
3. Buyer’s Tip – Hawaii Real Property Tax Rates and the Home Owner’s Exemption Help Lower Your Property Taxes

Various mortgage qualification criteria will determine if you can get the home loan you desire. Here are tips on how to prepare so you will be able to get a mortgage loan.

1) Check Your Credit Score

You are allowed one free credit report per year from each of the three companies that maintain credit reports – Experian, TransUnion and Equifax. Check AnnualCreditReport.com, a website jointly owned by these companies, and get your annual complimentary copy of your credit report.

• Make sure all three credit reports are accurate and that all past due debt is paid. Check your report closely for errors and be aware of any potential fraud (e.g., identity theft).
• Do everything possible to maintain a high credit score because not only will it help you qualify for a loan, it will also be used in determining your interest rate. A lower interest rate results in smaller monthly mortgage payments.
• If your credit score is bad, work on improving it. There are many resources online that will help you do this. However, beware of unscrupulous companies that offer to improve your score because they are likely scams. You can only fix mistakes on your credit report – you cannot undo your own past mistakes.

2) Reduce Your Debt

Get rid of credit card debt. This improves your debt-to-income ratio as well as your utilization ratio because you are using less of your available credit line. This will help your credit score.

3) Save Money

Saving money will benefit you in several ways. You will need money for a down payment and also for various costs associated with home buying, including the loan’s closing costs. To get the best interest rates, a borrower needs to have a substantial down payment, and there will likely be restrictions on how much of the down payment can be borrowed.

4) Determine Your Home Buying Budget

Analyze your financial situation and be realistic about your budget. Do this before talking to any lenders.

5) Find a Lender and Investigate Loan Options

Ask co-workers, friends, and family for referrals. Ask local real estate agents who they recommend. Also look for reputable lenders online to compare rates. Some companies can save you time by getting offers from multiple lenders at the same time. Also, be sure to research the various types of mortgage loans offered by lenders.

6) Consider Both Fixed-Rate Mortgage Loans (FRM) and Adjustable Rate Mortgage Loans (ARM)

Understand the advantages and disadvantages of each. With a fixed-rate loan the monthly payments will remain the same, while the payments on an adjustable-rate loan are subject to change.

7) Get a Good Faith Estimate of Closing Costs From Your Lender

Your lender is required by law to provide you this statement within three days of receiving the loan application. Also inquire about the terms of the loan and any special information you should know, such as prepayment penalties.

8) Stay Within Your Financial Means

Only you can realistically determine your own budget and how much you will be able to pay each month. Mortgage lenders will inform you what amount of loan you qualify for, but don’t let the mortgage lender determine how much you borrow – that is your decision. First time home buyers may qualify for lower interest rates or lower down payment requirements. Check with your county housing department, your employer, mortgage brokers, and online mortgage companies to see what programs may be available.

9) Choose A Loan

Pick a loan that best fits your particular circumstances. When you receive the final loan papers about one week before closing, make sure they match the original terms agreed upon. If you find a home you like and want to make an offer, have your mortgage broker/lender write a Pre-Qualification letter for only the amount of the offer so the seller is unaware if you can afford more.

Related posts:

1. Applying For A Hawaii Home Loan
2. Applying For A Home Loan – Basic Steps
3. 10 Reasons to Pre-Qualify For A Hawaii Home Loan

When is a good time to visit Hawaii?  That depends on your priorities. Do you want to save money?  Avoid people?  Would you like to maximize your chances of sunny beach weather?

Below is a review of the factors to consider when planning your visit, and the pros and cons of coming at various times during the year.

Peak Travel Seasons To Hawaii

• From June to mid-December and from January to March are peak travel seasons to Hawaii. If you are coming to Hawaii during a peak time, plan your vacation well in advance.
• A particularly busy time in Hawaii is during the last two weeks in December when it is very cold in many other places. Many visitors to Hawaii come during the winter to get away from the cold weather where they live.
• From mid-June until August is also a popular time for families to visit the Hawaiian Islands because this is when most children are out of school. As a result travel deals are usually harder to find during this time.
• A low season for visitors to Hawaii is from November until the middle of December.
• To get the lowest prices on airplane flights, hotel rooms, and other vacation costs, consider visiting during a Low Season. There are many last minute deals offered during these times, and also fewer visitors.
• The last week of April is known as Golden Week because three Japanese holidays come one after another during this time. There is a signicant increase in Japanese travelers to Hawaii, particularly Waikiki, during Golden Week.

Related posts:

1. Weather and Seasons In The Hawaiian Islands
2. Do All the Hawaiian Islands Offer the Same Lifestyle?
3. Overview of the Hawaiian Islands – The Aloha State

Hawaii basically has just two seasons, winter and summer.

The weather is slightly cooler during the winter, though still quite tropical and warm. There is more rain during the winter, but sunny days are also common.

During winter you may need a sweatshirt or light jacket to keep warm during some brisk nights, but during the days temperatures are still often balmy and tropical. Temperatures in Hawaii are usually in the 70′s and 80′s during the daytime, all year around.

Due to the prevailing northeasterly trade winds, some areas of the Islands are wetter than others. Weather patterns in the Hawaiian Islands may also vary a bit depending on the locations of particular mountain ranges and other geographical features.

In general, the eastern (windward) sides of the islands tend to get more rain showers, as do the north shores. The west and south shores tend to be drier and hotter.

No matter what time of year it is, sunny conditions can almost always be found somewhere on the west and south shores, while the east and north shores are also sunny most of the time though usually a bit cooler and breezier.

Higher elevation areas can be much chillier, such as the Upcountry region on Maui, Kokee State Park on Kauai, and of course atop the Big Island Volcanoes of Mauna Loa and Mauna Kea where snow is common.

However, most visitor accommodations are near sea level, and vacationers usually just visit the higher elevation areas and then return to the warm tropical weather near the coast.

Ocean temperatures in Hawaii are pleasant all year around. The water is about 78 degrees Fahrenheit in the summer and dips only a few degrees during the winter months. This is warm enough for an enjoyable swim without any need for a wetsuit.

Many surfers wear a “spring suit” – a short, thin wetsuit – during the winter months, especially if they are in the water a long time. However, many surfers choose to surf without a wetsuit, even during winter.

Related posts:

1. When To Visit the Hawaiian Islands
2. Overview of the Hawaiian Islands – The Aloha State
3. Hawaii Has Weather Too!

• Appraisers work either independently or on a fee-for service basis, and generally should have no interest in the value of the subject property.
• A code of ethics and standards mandates that Appraisers reveal to their client any interest they may have in the subject property. This ethics code is required as part of the licensing process for certified Appraisers.

2) An Appraisal is an estimate of value of the subject property based on an investigation of numerous factors including:

• The Property’s Size, Location, Condition.
• Economic Factors (Interest rates, Employment).
• Environmental Factors (Presence of Pollutants on the Land or Nearby).
• Demands for the particular type of housing (e.g., senior housing).

3) Why Do An Appraisal?

Appraisals are used to guide people in negotiations and other business decisions.

• Buyer and Sellers of Real Estate use Appraisals to determine a fair asking price for the property.
• Mortgage Lenders (e.g., banks) require appraisals if the property is being used as collateral on a loan.
• Appraisals are also done for Estate Valuation, Exchanges of Ownership, Court Proceedings (e.g., bankruptcy, divorce), Eminent Domain, Property Tax Assessments, and other tax reasons.

Related posts:

1. 6 Things Every Home Buyer & Seller Should Know About Real Estate Agents
2. Seller Savvy – Pricing Your Property to Sell
3. Preparing For A Hawaii Mortgage Loan

A real estate agent can:

1. Help you evaluate your financial situation and understand different financing options.  A Realtor can also assist you in finding a lender qualified to help you.
2. Help you present your home for sale, and also keep you up to date on current market information regarding competing properties, lending conditions, and other aspects of the local real estate market.
3. Pre-screen and escort qualified Buyers through your home to present it for sale.
4. Utilize resources available to them that will assist you in the real estate buying or selling process. An agent’s access to local community information will help you evaluate properties based upon objective information.
5. Provide you with the Due Diligence that is a crucial part of the process of evaluating a property.  An agent will also assist and advise you in how to complete inspections, resolve title issues, and deal with other aspects of the real estate transaction.
6. Coordinate with other agents through a Multiple Listing Service (MLS), providing other Broker as well as the general public with access to information about the property.
7. Help you in various negotiations including the terms of a contract, financing, needed repairs, inclusions and exclusions, and other items.
8. Help you evaluate any offers objectively, and also understand these offers in the context of the appraisal, inspection reports, the financing of the potential transaction, and other factors.
9. Help write a legally binding document that provides protection and is particularly suited for the situation.
10. Facilitate the closing process, help you avoid surprises, and assist in resolving any issues arising between the time of the agreement and Closing.  These issues may include financing and title issues, insurance questions, needed home repairs, and the paperwork needed to complete the real estate transaction.

Related posts:

1. Why Should I Use a Hawaii Buyer’s Agent – Part 3
2. Why Should I Use a Hawaii Buyer’s Agent?
3. 10 Reasons to Pre-Qualify For A Home Loan

Hawaii Inter-Island Airline Transportation

• Hawaiian Airlines Flies to: All the main Hawaiian Islands. Planes: Jets.
• Island Air Flies to: All the main Hawaiian Islands. Planes: Turboprop jet engines. Check out their route map.
• Mokulele Airlines Flies to: All the main Hawaiian Islands. Planes: Jets and single turboprop engines. Check out their route map.
• Pacific Wings Flies to: All main Hawaiian Islands except Kauai; also small Hawaii airports including Kalaupapa on Molokai, and Kapalua on Maui.   Pacific Wings also offers charter service. Check out their system map.
• go! Airlines Flies to: All the main Hawaiian Islands. Some flights are offered as code share with Island Air. Planes: Jets. Check out their route map.

Inter-Island Hawaii Ferries

• Maui-Molokai Ferry Route: Between Lahaina on Maui and Kaunakakai Harbor at Molokai. You can pre-arrange a rental car on Molokai or schedule a guided tour.
• Maui-Lanai Expeditions Route: Follows a regular schedule between Lahaina on Maui and Manele Bay on Lanai. Tour packages are available for Lanai.

Helpful Hints For Inter-Island Travel

• Most inter-island plane flights go through Honolulu Airport. When boarding your flight, check if there are any stopovers or connections, especially if you are using an airline searching website like Expedia or Kayak.
• To get the best prices, go directly to the website for each airline. If you buy the tickets by phone or at the airline counter you will have to pay an extra $10 to $25 or more.
• The inter-island ferries that travel between Maui and Lanai, and between Maui and Molokai, cross ocean channels that are sometimes quite rough. You may want to bring along some motion sickness remedies.

Related posts:

1. Talk Story #16 – Hawaiian Airlines and the New Honolulu Inter Island Terminal Lobby Design
2. More Airlift from the West Coast Equals an Improved Economy for Hawaii
3. Overview of the Hawaiian Islands – The Aloha State

1. More than 125 Primary and Secondary Private Schools in Hawaii are accredited by the Hawai’i Association of Independent Schools (HAIS).
2. HAIS provides a good summary and member directory of Hawaii’s private schools.
3. Among Hawaii’s top private schools are Punahou, Mid-Pacific Institute, Iolani and Kamehameha Schools.
4. The cost of a private K-12 school in Hawaii ranges from less than $3,000 to more than $15,000 per year.
5. An annual HAIS Admissions Fair is held in October to allow propective parents and students to meet representatives from the schools.
6. Private School Applications are accepted beginning in the fall, and many are due by December 1. The application process continues into spring and often include a review of the student’s report cards, teacher recommendations, a personal interview, an essay, and other documents.
7. Testing – Students applying for grades 6-12 may have to take the SSAT, while students in lower grades may attend “activity sessions” instead of an interview.
8. Competitive Admissions – Some of Hawaii’s private schools have extremely competitive admissions with many applicants for very few spots.
9. Hawaii has a higher proportion of students attending private schools compared to many other states.
10. A 2008 Hawaii Private School Guide put together by Honolulu Magazine includes a timeline of the admissions process, and also an assessment and ranking of all of Hawaii’s Public Schools.

Related posts:

1. Commonly Asked Hawaii Public and Private School System Questions – Moving to Hawaii?
2. Many Oahu Schools Get Top Rating!
3. Private Kuki’o Cottage For Sale – Simple Luxury, Location, and Price

1) What are the types of Agency?

• Listing Agreements in which the Real Estate Agent represents the Seller.
• Buyer Agency in which the Real Estate Agent represents the Buyer.
• Dual Agency in which one Real Estate Agent represents both the Buyer and the Seller in a transaction.

2) What Is A Listing Agreement, and What Are Some Types of Listing Agreements?

A Listing Agreement is an agreement between a Broker and a Client.

Types Of Listing Agreements Include:

a) Exclusive Right To Sell Listing

• The Broker has the exclusive right to market the property for the Seller and is paid the agreed-upon fee no matter who sells the property.
• If the Owner sells the property with no help from the Broker, the fee must still be paid to the Broker.

b) Exclusive Agency Listing

• The Broker is hired to act as the exclusive agent representing the owner and marketing the property for sale.
• The owner will not have to pay the Broker a fee if the owner sells the property without the Broker’s assistance.

c) Open Listing (Nonexclusive/General Listing)

• The property owner is not represented by any one Broker exclusively.
• The property owner may use as many Brokers as necessary to sell the property.
• No Broker will receive a fee if the owner sells the property without the assistance of any Broker.

3) What is the Multiple Listing Service (MLS)?

• The Multiple Listing Service is a marketing service that allows Brokers to share information about listings.
• Other Brokers may find a Buyer for a listed property, but the owner who has an agreement with the principal (the Seller) will earn a commission on the sale.
• Other Brokers who facilitate a sale may or may not receive part of the commission depending upon their agreement with the Buyer.

4) What Is the Agent’s Responsibility To The Principal (Client)?

• The Agent has a Fiduciary Duty to the Principal (Client), which may be a Buyer or a Seller. The Agent is the Fiduciary (Faithful Servant) of the Principal.
• The Agent must represent the best interests of the Principal above all others, including the Agent’s own interests.
• Brokers may be entrusted with funds such as the “earnest money” or “binder” that will be credited to the Buyer toward the down payment and eventually be transferred to the Seller. Other Buyer/Seller funds may also be held by the Broker.
• The safekeeping of Client and Customer funds is part of their Fiduciary Duty of the Broker and all monies must be kept in a bank account separate from the Broker’s business or personal accounts to avoid commingling of funds, which is illegal, as is conversion, using Client or Customer funds to pay business or personal expenses.

5) What Are Fiduciary Duties?

A Real Estate Agent is bound by Fiduciary Duty to the Client, who may be the Buyer or the Seller.

The Primary Fiduciary Duties Are:

a) Care – Requires Agent To Use Their Best Effort and Skill To Help Their Client.

• Suggesting that the Buyer Client hire a reputable Home Inspector.
• Informing a Buyer Client about prices of other properties.
• Helping a Seller Client determine the Property’s fair asking price.
• Making every reasonable effort to market a Seller Client’s property.

b) Confidentiality (Provision of Fiduciary Duty)

• Requires Agent to protect Client’s interest by keeping confidential all information that might harm the Client and personal information the Client wishes to keep private.
• Even if the Agent believes that certain confidential information will not harm the Client’s interest if revealed, the information still must be kept confidential.

Examples of CONFIDENTIALITY:

• A Seller Client has a strong desire to sell their property to generate money needed for some other purpose.

c) Disclosure (Provision of Fiduciary Duty)

• A Buyer Client has the ability to pay more for a home than is offered, or needs to buy a house soon so their kids can be settled in for the school year.
• Requires Agent to reveal all known facts that might benefit the Client.
• Even information not requested by the Client, but known to the Agent, must be revealed to the Client if it might benefit them.

Examples of DISCLOSURE:

• A Buyer Customer tells the Buyer Agent that he may have difficulty getting a mortgage and asks the Agent to keep the information private. The Agent must reveal this to the Seller Client.

d) Loyalty (Provision of Fiduciary Duty)

• Requires Agent to put Client’s interest above all others, including the Agent’s own interest.

Examples of LOYALTY:

• An Agent knows a Seller will take $400,000 for a property and the Agent’s Buyer Client wants to offer $410,000 to make a lower offer. Fiduciary Duty requires the Agent to tell the Client.

E) Obedience (Provision of Fiduciary Duty)

• Requires the Agent to follow Client’s instructions as long as they are legal and ethical.

6) What Are the Agent’s Duties To the Customer?

While this article deals primarily with the Agent’s duties to their Client, the Agent also has duties to the Customer who wants to either buy or sell the property of the Agent’s Client.

Agent’s Obligations to Customer:

• Honest and Fair Dealing – Agents must be honest with Customers, treat them fairly and properly account for all funds entrusted to the Agent.
• Reasonable Care – The professional expertise and skills of the Agent must be utilized to assist the Customer to the extent that their Client’s interests are not compromised.
• Disclosure of Material Facts – Important facts that may affect a Buyer’s decision about a house must be told to the Buyer, including structural problems, environmental hazards, leaks, mold, etc.

Related posts:

1. Seller Savvy – Changing Listing Agents Midstream
2. Seller Savvy – The Two Faces of Dual Agency
3. Hawaii Real Estate Agency Laws

File An Application and Contractor’s Statement

• The first step in getting a Building Permit is to file the proper paperwork with the Building Division at the Department of Public Works on your island.

House Plans / Blueprints

• You will be required to submit up to five sets of blueprints. The number varies on the different islands and also depending upon the purpose of the structure (e.g., residential, commercial).
• Blueprints need to be stamped by a licensed structural engineer or architect.
• Blueprints will include a plot plan and floor plan as well as details of the foundation, framing, elevations, and electrical and plumbing plans.

Who Approves Your Permit

• Your plans will have to be approved by various county departments including the Planning Department, Department of Water, Department of Health, Engineering Division, Fire Department, Wastewater Management, and the Building Division, with some exceptions/additions based upon the location and purpose of the structure.

Requirements

• You will be required to follow all zoning requirements in the area where you are building, as well as any other rules that may apply (e.g., Special Management Area rules, Shoreline Setback requirements, etc.)
• You may also need a grading or grubbing permit if you are moving a significant amount of dirt or clearing a large area of land.

The Waiting Period

• Once your plans are submitted and the proper forms are completed, you will typically wait from four to eight months for approval.
• Sometimes home plans get lost or paperwork is missing. Any one of the various departments might have a problem with your permit application, and you may not be called in a timely manner to rectify the situation.
• To expedite the process and/or to avoid lengthy delays, regularly check the status of your application online and also keep in touch with the reviewing agencies.
• As soon as it seems like there may be a delay (e.g., a particular department has the plans for an several weeks without action), try to keep things moving along smoothly by gently prodding the department for information on the status of your permit.

Related posts:

1. Relocating to Kauai – Things to Know About Pets, Permits, and Important Phone Numbers to Get You Started
2. 50 Year Old Hawaii Homes no Longer Need Special Attention from State
3. Regulations for Building an Oahu Home on Agricultural Land