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Should Mom And Dad “Gift You” With A Down Payment For A Home?

OK, let’s face it: many of us got a little help from mom and dad when we bought our first homes back before zero-down loans. Guess what, it’s 1980 all over again. Tough Love in lending and we are back to ten,  twenty percent down payments,  tough for kids fresh out of school, loaded with education debt, to come up with. No wonder lenders are seeing a surge in kids asking M&D for help with down payments. Keep in mind, the help cannot be a loan and you must document the down payment gift with a “gift letter.” My fave mortgage blog has all the details on the right way to do a gift letter, and will even email you a sample. To satisfy underwriter’s increasingly unsatiable appetites, you’ll need the gift letter, the gift in a cashier’s check, and no co-mingling of funds on deposit. 

This is not new: the tradition at Romanian weddings was to pin money on the bride (a tradition I’d like to revive), that money going to help the couple buy their first home. There are also many ways parents can help their children buy a home without giving them a chunk of cash. For example, we let my daughter and her fiance live with us while they saved up for a down payment. You can also cover the cost of property improvements on the new home once they move in.

Call me Debbie Divorce Downer, but I am a member of the 50% divorce rate generation: what do you do if the marriage doesn’t last? Let’s say you “gift” Johnny and Susie $20,000 for a down payment on a cute M Streets cottage. They split after two years. Texas is a community property state, home is to be sold and equity split. My take: you have just gifted your son-in-law $10,000. Am I correct?

Your Commission Dollars At Work: A Lot Of Dallas Folks Don’t Realize This…

That real estate companies pay big time for those appearances on Good Morning Texas. I saw this on Frontburner and it reminded me: I cannot tell you how many consumers are genuinely shocked when they learn that their realtor/broker paid to be on the show. (Hate to burst your bubble, but doctors pay, too.) Of course, as one publicist told me, no one is as surprised as the realtor/broker who says, can’t you get me on Good Morning Texas? Sure I can, says the publicist, for about $15,000.

If You Get “THE LETTER”, It Means You Have Arrived, They Are Dying To Get In

Yes, “The Letter”. It’s an elegant correspondence from a real estate agent, and it goes something like this: Dear So & So, We are working with a (delightful, dynamic) couple (sometimes called the buyer) who is seeking a home in your area. They are well-qualified cash buyers (read: members of the Lucky Sperm Club) who do not require the sale of another home as a contingency (read: it’s already sold, or daddy can just write a check). They are willing to be flexible with closing or possibly lease-back (to you, but don’t think you can replace those nickle drawer pulls with Home Depot stainless — they’ll snap photos). Please call us at your earliest if you are at all interested.

Oh yeah, this is a good letter to get. Hang onto it — and that’s a good agent out there busting (Gucci) shoe leather trying to find a home for a client.   This is exactly what Allie Beth Allman did for months trying to find a home for former President George and Laura Bush. In fact, that may have been how she found the house on Daria Drive.This is what Kenny Troutt did a few years back when he decided to buy up multiple acres at Inwood and Royal, an area he later sold to Hillwood which is now known as the Creeks of Preston Hollow. (I must tell you that story someday.) Getting the letter means you live in a hot ‘hood where others are dying to move in and you may not have to crump on your asking price too much. In the good old days, you might even have had a few back-up contracts.

We love getting The Letter. Just don’t show it to DCAD.

Energy-Efficiency Incentives For Home Buyers Are Growing, Blowing

I’ve heard this from both coasts, and already happening in Austin. FHA is prepared to give borrowers up to 5% more in loans if they use the funds to make their homes more energy efficient. That could be an extra $15,000 on a $300,000 mortgage to use for tighter windows, improved insulation, tank less water heaters, etc. Remember that FHA only covers conforming loans, that is, up to $417,000 in our area. But still, this could not only help spur home sales but stir up business for the folks who make your home energy efficient. Stay tuned this week for an interview with a realtor who takes 1% of his commission, comes to your new house, and puts the money to work making your home superbly green.

Unlike Dallas Real Estate, Chicago LakeFront Mansion Take It On The Chin

In this glorious part of Chicago, it seems the high end is not doing as well as it is in Dallas: a lake front home can now be had for under $3 million!!!

Dallas Real Estate Weekend Open House: Thumbs Up For Eastview Circle

Another collaberation from builder Richard Milligan and renowned interior designer Neal Stewart, this pup is nestled on a lake-skirting elevated property in the Northaven estate area a.k.a. Preston Hollow north. These guys so know what they are doing- contemporary feel but warm, inviting.  Sleek Italianate built around an interior courtyard with rectangular pool, fireplace, and seating areas; inside, large foyer, the living room with 16 foot ceilings, heavy coved crown moulding, and massive fireplace. The dining room is almost a perfect square, offering many options for table arrangement, Adjacent is a butler’s pantry with wine storage, ice maker and bar. The kitchen is a cook’s/entertainer’s dream. Get this: Wolf 48″ range, Sub-Zero refrigerator and freezer, double Miele dishwashers, and large center island. Hammered lead covered vent-a-hood, Madeira marble and Caesar stone countertops. Love the master bath, wish that that “Light Emperador” marble would sprout legs and walk to my house; love the HUGE master closet — must post photos. In all seriousness, this is one home I might actually buy. $1,890,000. Might be a little pricey, but you cannot beat this location. I can see empty nesters in this home, two bedrooms/baths upstairs to let the kiddos visit, but not live.

How much should I offer?