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"Jumbo" Loans vs. Conforming Loans

Katie Wethman's Thoughts on Washington, DC and Northern Virginia Real Estate has an excellent entry on the difference between a Conforming, Jumbo, and FHA loans.  I didn't realize that the point at which a loan became a "Jumbo" loan was when Fannie and Freddie could not buy the loan--the present limit is around $417,000.

How long with it last: Life expectancy of common household components

An excellent post on the Home Inspection Blog on the life expectancy of some common household items.  Sample life expectancies include:

WSJ Article - Beyond Auctions: Ways to Buy Foreclosure Homes

A good article in the Wall Street Journal on buying foreclosed homes.    It states:

Warren Buffett on the Mortgage Market

Here’s an interview with Warren Buffet on CNBC.COM covering the financial aspects of the current mortgage market specifically Freddie and Fannie.

Watch Buffett on Freddie and Fannie

I'm Finally Done!

For some idiotic reason, I decided to do the finish out myself. So, for the last month, I’ve been at the house installing light fixtures, putting up ceiling fans, replacing door and cabinet hardware, putting in new toilets, installing appliances etc. This last stage is crucial. So many times, people do a great job remodeling a place but then skimp on the fixtures and hardware. For the average consumer, this is the first thing they notice. You don’t have to spend a fortune on light fixtures, just be sure and go above apartment grade stuff.

What's taking me so long?

This is, by far, the slowest remodeling project I've ever done. I had a LOT of distractions in 2004 that kept me from working on this house. Then, in 2005, I went to India for a month so not much work got done then. It is now April and I'm still working on the property.Let's talk about what we have done since the last posting. After firing my old hippy carpenter, I went into a lull for several months and didn't work on the property due to some personal stuff.

My Old Hippy Carpenter

The first contractor I use on my remodels is my Old Hippy Carpenter (we'll call him OHC). In the past, OHC had done an excellent job for me by coming up with practical and cost effective solutions to complicated problems. For example, foundation guys usually want a fortune to replace a rotted beam under the house. OHC would go down there with a car jack and some day labor and replace it for $50.The bad thing about OHC is that you have to watch him. Otherwise, he'll work really slowly.

The Lowe's Marathon

As I mentioned in the last post, I spend a lot of time at Lowe's and Home Depot looking for supplies. This remodel is no exception. I started with a preliminary trip to Lowe's just to make a list of stuff I need and to get prices on everything from doors to light fixtures. This preliminary trip lasted about two hours. Keep in mind, I didn't buy a thing. Lowe's probably had about 80% of what I needed but some of the items were pretty expensive.

Evaluating what needs to be done

This is often as difficult as finding the property. When doing flips, it's important to think purely in financial terms when deciding on items to improve or repair. Sure, those granite countertops may look great but chances are you won't get your money back on them in a $150,000 neighborhood. Try to pick items that will only increase the value of the house. (It goes without saying that safety and structural items should be done so you're not selling someone a money pit.)

Poll

What contributed most to the subprime crisis?: