What you see is not always what you get. Online home shopping presents its own unique set of challenges.

It's so easy to shop online for just about anything these days. You can use Google, Froogle, Yahoo, or any of the shopping search engines to find everything from recliners to shoes, airlines tickets to t-shirts. More than 85 percent of home buyers start their search for a house online as well. The only problem is that things on the Internet are not always what they seem.

That's not such a big deal when it comes to a $60 pair of shoes. But it can be quite problematic when you're talking about a house priced at $350,000. Based on the e-mail I've received over the last couple of years, I've come up with a list of six mistakes home buyers make when shopping online for real estate, and the mortgage they need to pay for it:

Mistake #1: The house you see online is the house you get.If you saw a house advertised on television, you'd wonder exactly what you were buying for your money. But find a house online and that skepticism goes away. Some buyers feel confident enough to make an offer for a home they've seen only online.
What's that about? If I was writing the description for a property I was trying to sell, I'd make sure it sounded as fabulous as possible. The only point of writing that description would be to get a prospective buyer through the door. So when you see a photo of a house online that looks interesting make an appointment to see the property in person. That way, you'll know what you're buying is real.

Mistake #2: A beautiful photo, virtual tour or video means the house is in perfect condition.There are things you can see in a photo, virtual tour or video -- and then there's everything you can't see. Clearly visible is the décor. But the structural and overall physical condition of the property may not be as apparent. Don't assume that a fresh coat of paint is simply covering a dingier coat of paint. Instead, when you walk through the property, keep your eye out for red flags, such as water stains, bad smells, a freshly painted basement (which could be hiding mold or moisture stains), doors that don't shut, and cracks bigger than 1/8 inch wide.

Mistake #3: Assuming the neighborhood is as nice as the video tour.If a seller has created a video or taken a series of snapshots of the exterior of the home, it's possible you'll get a feel for what the neighborhood is like. Again, don't assume that what you're seeing is real. Savvy buyers will spend time walking the streets of a neighborhood, getting to know the housing stock, local store owners, recreational opportunities and schools. There's no substitute for using a little shoe leather.

Mistake #4: Believing that a fabulous Web site means you're dealing with reputable professionals (agent, title company, lawyer, home inspector, etc.).
It takes about $50 and a few hours to put up a fairly impressive-looking Web site. Maybe the company behind that Web site is reputable -- and maybe it isn't. But if you just go by the graphics and design of the Web site without checking to see who the folks are behind the beautiful pictures, you won't know who you're dealing with.
Whether you're looking for a real estate agent, title company, real estate attorney, home inspector or other player in the real estate industry, you should take the time to do your due diligence and find out everything you can about the individual and the company he or she works for. Real estate agents, brokers, attorneys and title agents are all licensed by the state. You can start with the agency or department that licenses these professionals in your state, and then use an Internet search engine to dig up more information, such as complaints or lawsuits that have been filed against the company or individual. Don't forget to pay a visit to the professional's office. You can tell a lot about someone depending on where they work, and how long they've been in business.

Mistake #5: Believing a written description of a property or neighborhood is accurate if you read the same thing in enough places.
It doesn't matter how many times you read the same description of a property, you won't know it's real until you've been there and seen it in person. Remember, just because an agent says the condo has a "lake view" doesn't mean you'll have a full water view. It might mean that if you stick your neck out the window and turn, you'll see a sliver of water.

Mistake #6: Believing the interest rate you'll get at the closing is the same that you've seen online.
One of the most popular mortgage scams is the "bait and switch," and it's even easier to get away with it on the Internet. Here's how it works: You'll see a great interest rate online and when you call to follow up, you'll be told either that the rate has expired (at which point the lender will try to sell you on a more expensive loan) or that you've qualified for it. If you've "qualified" for the rate, you'd better check your mortgage documents thoroughly at the closing to make sure the rate you thought you were offered is actually the rate that is on the papers you're signing. Once you sign the papers, it's a lot harder to get the lender to live up to his or her initial mortgage commitment. (Of course, you'll have a stronger case if you have that rate quote in writing.)

The hits just keep on coming. A tight market still means incredible opportunity in Indiana.....

While the foreclosure rate has edged up, what it really translates into is great values that will pay off significantly in years ahead.


From the Indianapolis Star August 21, 2007:

Manufacturing-related job losses are playing a big role fueling Indiana's foreclosure rate, which now ranks among the highest in the nation, experts say.

Indiana, Ohio and Michigan have all been hit hard by cutbacks and plant closings, and together the three states account for 20 percent of the nation's home foreclosures. Many of those workers affected were homeowners.
"If you have economic problems and little equity to fall back on, it all feeds on itself," Tom Dinwiddie, a spokesman for the Indiana Bankers Association, told The Times of Munster.
Peter Novak of the Greater Northwest Indiana Association of Realtors said the fallout of yearslong subprime lending is being felt both locally and nationally. Analysts estimate nearly 2 million adjustable rate mortgages will reset to higher rates nationwide in the next year or so.
Indiana has one of the highest homeownership rates -- about 75 percent -- but it also has the second-highest foreclosure inventory rate.
Novak said some home buyers think they will be able to afford a house through an adjustable rate mortgage, but when the rates increase some are unprepared for the larger bills.
"An adjustable rate is cheaper the first years so homeowners hope their personal outlook will be better in the future and unfortunately that's hardly true. Lots of time they're in the same situation and probably worse," he said.
Low rates of appreciation on real estate values coupled with affordable housing and high loan-to-value loan ratios also are major factors in Indiana's high foreclosure rate, Novak said.
Indiana ranked 44th in the most recent measure of one-year price growth by the Office of Federal Housing Enterprise Oversight. Hoosiers also use more down payment assistance programs, which reduce or eliminate cash down payments.
Home buyers need to be smart about what they can afford, Pamela Stalling, executive director of the Consumer Credit Counseling Service of Northwest Indiana.
"The reality is we need jobs to keep people in these homes," Stalling said. "And they need to be educated on making wise decisions about if they can afford it now or years down the line."

Real Estate and the dog days of summer. Let's face it...the real estate market is a tough place right now. For those of us who love what we do, we're in it for the long haul. It just doesn't change the reality that nationally and locally we're in a very difficult time. That translates several ways. First, nearing the bottom of the trough, it is a good time to buy. There are exceptional opportunities out there that will pay huge dividends down the road as an investment but you must have vision. Selling right now takes backbone and the courage to make smart, strategic decisions. There is no logic to the market. Some homes that are not, at first glance, competitive sell quickly. Good homes that should sell, sit. Should one attempt to market their home at this point in time? First and beyond that always translates into personal need. If your circumstances dictate a move, then do so in an intelligent, aggressive way. This is no time for greed so if you need to sell, be practical.

Long term rates edge down. For a change last week, long term rates came down to more attractive levels. Long-term mortgage interest rates were down Friday, and the benchmark 10-year Treasury bond yield slipped to 4.68%. The 30-year fixed-rate average fell to 6.23 percent, and the 15-year fixed rate sank to 5.91 percent. The 1-year adjustable held steady at 5.51 percent. The 30-year Treasury bond yield was down at 4.87 percent.

Is the stock market surge over the last 9 months really that surprising? Face it, with real estate numbers slumping all over the U.S., it's not rocket science that since last fall the markets have set record highs. Investors wanted a place to put their money and it wasn't going to be in the real estate market. Watch this carefully over the long haul. When we see a trend that has money consistency leaving the markets for real estate, we may be on our way back up in property value and demand. The last few weeks have demonstrated volatility in the stock market based on one major issue: credit. From the sub prime mortgage problem which is now in the 2nd inning of a 9 inning game to the more recent "A minus" lending downturn, there is a significant credit issue with our housing market that will affect us into 2008.

Property tax issues will remain for a number of Indiana counties through the early part of 2008. Most people think that as Governor Mitch Daniels suspended property taxes to the 2006 level, we were out of the tax nightmare. Wrong. We've suspended our problems, not fixed them. Those reassessments will be back in early 2008 shortly before the 2007 taxes kick in. This whole thing is still very much in flux. From the inside we're hearing that Marion County's problems may be solved by a 1/3, 1/3, 1/3 solution. That is a 1/3 higher residential tax than '06, some form of a consumption tax that will cover 1/3 of the previous tax increase and finally 1/3 higher assessments on business locations that saw virtually NO increase in valuation in the previous numbers. Stay tuned......

National Housing Numbers eyeing the future?
According to First American's CoreLogic which tracks national real estate trends,

"House-price acceleration -- the rate of change in home prices, whether up or down -- is also moderating after 18 months of decline, evidence that downward price trends at the national level are nearing bottom.

Further, prices were still rising in eight of the 10 markets identified by CoreLogic as the highest risk. The highest-risk markets were: Detroit-Livonia-Dearborn, Mich. (-.46 percent appreciation); Warren-Troy-Farmington Hills, Mich. (1.21 percent); Memphis, Tenn. (6.63 percent); Youngstown-Warren Boardman, Ohio-Penn. (4.8 percent); Dayton, Ohio (4.42 percent); Grand Rapids-Wyoming, Mich. (1.55 percent); Toledo, Ohio (1.66 percent); Cleveland-Elyria-Mentor, Ohio (4.89 percent); Indianapolis-Carmel, Ind. (-3.5 percent); and Akron, Ohio (6.14 percent).

Prices continued to rise in all 10 markets identified by CoreLogic as those with the lowest risk: Sarasota-Bradenton-Venice, Fla. (2.51 percent appreciation); Orlando-Kissimmee, Fla. (4.19 percent); West Palm Beach-Boca Raton-Boynton, Fla. (3.97 percent); Ft. Lauderdale-Pompano-Deerfield Fla. (5.57 percent); Washington, D.C.-Arlington-Alexandria, Va. (3.51 percent); Virginia Beach-Norfolk-Newport News, Va. (9.18 percent); Richmond, Va. (7.12 percent); Bethesda-Gaithersburg-Fredericksburg, Md. (2.45 percent); Salt Lake City, Utah (12.96 percent); and Honolulu, Hawaii (7.87 percent)."