Posts Tagged ‘Washington DC’

The National Association of Realtors is protesting an increased fee being charged by Fannie Mae.  The fee, as much as 3.25% of the loan amount, is being charged to lenders who pass on to borrowers with credit scores as ‘low as 690.’  See article by James R. Hagerty in the Wall Street Journal.

Let’s do a quick analysis.  This really makes sense.  If you have a loan amount of $200,000, then the fee would be $6,500.  And, that doesn’t include any title company, broker fees, appraiser fees, etc.  Great way to jump start economy, Fannie.

Since the average credit score nationwide is around 690, this hurts the average borrower.

Good luck to the National Association of Realtors!

Notwithstanding the 6-month adjustable rate mortgage, when I sold my condo about 5 years later, I ended up with a profit of about $25,000.

But that’s not the whole story.

Less than a year after I bought my condo, my job moved from the suburbs to downtown Washington, D.C.  It was a real uncomfortable commute.  I had to drive about 12 miles!  Too much for this twenty-something year-old.   Plus DC was a happening place!  Why was I living way out in the suburbs?  What had I been thinking?

I rented out my condo to a woman about 20 years older than me.  She was just getting a divorce and couldn’t believe she could call me for any maintenance issues.  Fortunately for me, she was on good terms with her ex-husband, and she called him for any property malfunctions.  I still can’t believe my luck with her!

I went on to rent a row house in Georgetown.  Now I owned investment property and could depreciate it each year on my taxes.  The only thing is it would come back to haunt me after the sale.  I had to pay capital gains taxes.  At that time they were about 30%.

A profit?  Well, sort of.

Vistas of Vienna - My First Condo

I thought the real estate agent was my friend. After all, I was only a 24 year old single gal, what did I know about real estate? It was 1985 — none of my friends were buying real estate. I trusted her.

The agent, Suzie, drove me around all day long looking at different condo projects. It was Fairfax County, Virginia – a Washington, D.C. suburb. Finally around 4pm, we were at a condo project being built. I was hungry. Feeling shaky. I loved the place — it had a fireplace and a cathedral ceiling. Pretty cool for 1985. Boy, was I hungry. Suzie was insistent we get this contract written up before I lost the condo. I was not excited. I was hungry!

What I didn’t know was the real estate agent wasn’t my friend. Far from it. In those days the agents worked for the Seller; there were no Buyer Agents. She wasn’t looking out for my interests. The fact that she didn’t take me to lunch should have been my clue!

The next day, after I had eaten two meals, I felt really nervous. What had I done? This condo was way over my budget! Yikes, I had to get out of it. I didn’t want that place. I called Suzie and told her I didn’t want it, but I wanted the older condo we saw which was about $25,000 less. It didn’t have a fireplace or cathedral ceilings, but it was in my budget. That’s how I found my first condo at the Vistas of Vienna — a first floor, two bedroom, two full bath brick unit with a nice patio, double ovens and a garbage compactor.

Today my next door neighbor, Sheila, is a successful, long-time real estate broker. Sometimes she regales me with stories about taking her clients out to look at property, stopping at Starbucks and buying them drinks, taking time for a nice lunch. Suzie could learn a thing or two!