More than just real estate.
Fantastic news! The House of Representatives just voted 403-12 to pass the Homebuyer Tax Credit! This is the same bill that passed in the Senate yesterday. The next step is the President’s signature, but he has already committed to signing it (probably tomorrow). This news should help us build on the momentum that we are now experiencing in our housing market.
After the Senate gave final approval last night without a dissenting vote, the House of Representatives voted overwhelmingly this afternoon to pass legislation containing an extension and expansion of the homebuyer tax credit, completing Congressional action and sending the tax credit to President Obama for his signature, possibly as early as tomorrow.
The $8,000 homebuyer tax credit for first-time buyers, due to expire in 25 days, will be extended through April 30 of next year and buyers will have an additional two months, until the end of June, to close. First-time buyers who are in the process of making a purchase will no longer need to worry about qualifying for the $8,000 credit if they close after the November 30 deadline. The new legislation increases the income limit for couples with income up to $225,000, a nearly $55,000 increase above the level in existing law.
For the first time, the new legislation makes buyers who already own a home eligible for a credit. A $6,500 maximum credit will be available to existing homeowners who have lived in their current residence for five of the prior eight years. The legislation limits eligibility for the existing homeowner credit to homes worth $800,000 or less.
The legislation takes effect December 1 and is not retroactive. Both credits are available only for primary residences, not second homes or investment properties.
In the House debate, Speaker Nancy Pelosi (D-Calif.) took the floor to say the homebuyer tax credit was helping a new generation of Americans live out their dream of homeownership and financial independence. Debate on the homebuyer credit was overwhelmingly positive and the legislation passed 403 to 12.
However, several leading economists have voiced concern about the $16.7 billion cost of the credit and the wisdom of spending up to $400,000 per homebuyer to stimulate real estate sales and White House support for extending the credit has been lukewarm at best. However, it is virtually certain that the President will sign the legislative package, which contains an expansion of unemployment benefits as well as the tax changes.
In the Senate, the homebuyer tax credit was amended to a bill expanding unemployment benefits by 20 weeks for those who have exhausted their benefit. The latest unemployment numbers are due out tomorrow and Congressional leaders are rushing the unemployment bill to the White House so that the President can show compassion by signing on the same day more job losses are announced.
The legislation included provisions added to address complaints of fraud. The Internal Revenue Service is given greater authority to oversee the process to root out fraud, and provisions are added in response to past abuses of false sales or underage buyers. An investigation by the Treasury Department’s Inspector General for Tax Administration found that more than 580 children, some as young as four years old, had received $627,000 in first-time homebuyer credits. The IRS has identified 167 suspected criminal schemes and opened nearly 107,000 examinations of potential civil violations of the first-time homebuyer tax credit.
The legislation also contains a provision supported by the National Association of Home Builders which will help larger companies strapped for cash with net operating losses (NOL). Ordinarily these companies can carry back these losses for only two years to qualify for a tax refund. The provision would make this process extend the carry-back to five years for either 2008 or 2009. The tax break will now apply to losses in either 2008 or 2009, and the income cap will come off.
From RISmedia
Thursday, November 5, 2009
Wednesday, November 4, 2009
More news for local investors
More than just real estate.
Last week we saw that some 35 percent of home sales during the past year were bank-owned foreclosures or government-owned resales. That is a huge increase from just a few years ago when sales of these homes were not a significant part of the Atlanta market.Two factors cause these homes to sell at dramatic discounts:* Lenders and government agencies are charged with disposal of these properties regardless of price. These sellers simply do not have the luxury of waiting until the market improves; and* These same sellers have a strict policy of selling the properties in "as-is" condition, meaning no repairs and no disclosure statements. The buyer takes all the risk. As a result, the only potential buyers are investors looking for a bargain.So, what are the specific characteristics investors look for in today's market? There are many, but the main three are:
1. A LOW PRICE This is the most important part of the equation. The acquisition price needs to be low enough to cover all needed repairs, carrying costs, marketing expenses and still represent a bargain to the end consumer. Whether the investor intends to resell to an owner-occupant, or hopes to rent for long-term appreciation, the price paid for the acquisition is critical to all later profitability.In the case of Atlanta's post-foreclosure marketplace, investors have found a "market bottom." In other words, almost anything will sell very quickly if it is offered in the $30,000 to $40,000 range. Furthermore, the market is getting hotter.
2. SCOPE OF REPAIRS While the uninitiated might think that the level of repairs necessary would be the most important consideration of an investor, such is not the case. Instead, price conquers all. Sometimes the best deals require cash for major systems as well as structural repairs.That being said, every investor hopes to minimize capital outlays for the rehab. Paint and carpet is a must, and updated countertops and lighting fixtures are almost always part of the needed work. Beyond that, the house becomes less attractive. Smart investors are experts at estimating overall repair costs. And finally,
3. NEIGHBORHOOD Investors always look for pride of ownership in the neighborhood. In other words, is this the kind of area where a typical buyer or renter would want to live once the renovation is complete? If the answer is no, then all other factors become less important.Graffiti in the community, junk cars littering the yards, "boarded up" or vacant homes are all indications of problems in the neighborhood. Wise investors try to avoid these signs.The good news is that Atlanta's investor community is working hard to absorb this glut of bank-owned homes. The question no one can answer is when the supply of these homes will begin to decline.
Last week we saw that some 35 percent of home sales during the past year were bank-owned foreclosures or government-owned resales. That is a huge increase from just a few years ago when sales of these homes were not a significant part of the Atlanta market.Two factors cause these homes to sell at dramatic discounts:* Lenders and government agencies are charged with disposal of these properties regardless of price. These sellers simply do not have the luxury of waiting until the market improves; and* These same sellers have a strict policy of selling the properties in "as-is" condition, meaning no repairs and no disclosure statements. The buyer takes all the risk. As a result, the only potential buyers are investors looking for a bargain.So, what are the specific characteristics investors look for in today's market? There are many, but the main three are:
1. A LOW PRICE This is the most important part of the equation. The acquisition price needs to be low enough to cover all needed repairs, carrying costs, marketing expenses and still represent a bargain to the end consumer. Whether the investor intends to resell to an owner-occupant, or hopes to rent for long-term appreciation, the price paid for the acquisition is critical to all later profitability.In the case of Atlanta's post-foreclosure marketplace, investors have found a "market bottom." In other words, almost anything will sell very quickly if it is offered in the $30,000 to $40,000 range. Furthermore, the market is getting hotter.
2. SCOPE OF REPAIRS While the uninitiated might think that the level of repairs necessary would be the most important consideration of an investor, such is not the case. Instead, price conquers all. Sometimes the best deals require cash for major systems as well as structural repairs.That being said, every investor hopes to minimize capital outlays for the rehab. Paint and carpet is a must, and updated countertops and lighting fixtures are almost always part of the needed work. Beyond that, the house becomes less attractive. Smart investors are experts at estimating overall repair costs. And finally,
3. NEIGHBORHOOD Investors always look for pride of ownership in the neighborhood. In other words, is this the kind of area where a typical buyer or renter would want to live once the renovation is complete? If the answer is no, then all other factors become less important.Graffiti in the community, junk cars littering the yards, "boarded up" or vacant homes are all indications of problems in the neighborhood. Wise investors try to avoid these signs.The good news is that Atlanta's investor community is working hard to absorb this glut of bank-owned homes. The question no one can answer is when the supply of these homes will begin to decline.
Monday, September 7, 2009
Great News For Veterans
More than just real estate.
Veterans Can Buy a Home for Nothing Down, and also get the $8,000 Rebate.
Long regarded as one of the best programs of its kind, the VA Home Loan program guarantees loans made to veterans of the United States armed forces, and allows them to purchase a home with little or no down payment. In fact, in some cases, the veteran can even include the costs of closing in the loan itself, allowing a home purchase with literally no down payment.
Couple that program with the soon-expiring federal "First Time Home Buyer" tax credit of up to $8,000, and there is an almost irresistible incentive for any qualifying vet to stop renting and start owning now.
Here's what you need to know:
* VA loans are available to qualifying veterans, up to a limit of $417,000 in most Georgia counties. In most cases, the veteran will need 181 days of active service, but requirements vary based on service dates and branch of service.
* VA loans are available through most mortgage lenders, although my advice is to seek a lender who specializes in VA and FHA products, as they require a different qualification process from most conventional loan programs. Your real estate professional can suggest several lenders.
* Because VA loans are guaranteed by the government, lenders are willing to lend up to 100 percent of the purchase price, and, in some cases, include all closing costs and expenses. No mortgage insurance is required. In addition, because the lender sees little risk in a guaranteed loan, the interest rates are typically competitive with conventional loans.
* Qualifying for a VA loan is easier because the lender's loan is backed by the government, so a less-than-perfect credit application may be accepted. Even so, your income, your monthly debts, and the proposed mortgage payments are all totaled up to see where you land in terms of debt.
The VA loan program is a great benefit for veterans, but coupling it with the First Time Home Buyer tax credit makes the purchase almost too good to be true.
* First time home buyers purchasing any sort of home, new or resale, are eligible for the tax credit. The credit can be used against future federal income taxes, or you can file an amended return for last year and get a check quickly.
* The credit is for an amount equal to 10 percent of the purchase price, up to a maximum of $8000. It is available to anyone, not just veterans. And "first-time" means neither you nor your spouse may have owned a principal residence during the 3 years prior to this purchase.
Here's the kicker: this tax credit is currently set to expire on the first of December, so my advice is to move quickly. There's still time! For more information, talk to any real estate professional or home loan originator.
Courtesy Atlanta Journal-Constitution.
Veterans Can Buy a Home for Nothing Down, and also get the $8,000 Rebate.
Long regarded as one of the best programs of its kind, the VA Home Loan program guarantees loans made to veterans of the United States armed forces, and allows them to purchase a home with little or no down payment. In fact, in some cases, the veteran can even include the costs of closing in the loan itself, allowing a home purchase with literally no down payment.
Couple that program with the soon-expiring federal "First Time Home Buyer" tax credit of up to $8,000, and there is an almost irresistible incentive for any qualifying vet to stop renting and start owning now.
Here's what you need to know:
* VA loans are available to qualifying veterans, up to a limit of $417,000 in most Georgia counties. In most cases, the veteran will need 181 days of active service, but requirements vary based on service dates and branch of service.
* VA loans are available through most mortgage lenders, although my advice is to seek a lender who specializes in VA and FHA products, as they require a different qualification process from most conventional loan programs. Your real estate professional can suggest several lenders.
* Because VA loans are guaranteed by the government, lenders are willing to lend up to 100 percent of the purchase price, and, in some cases, include all closing costs and expenses. No mortgage insurance is required. In addition, because the lender sees little risk in a guaranteed loan, the interest rates are typically competitive with conventional loans.
* Qualifying for a VA loan is easier because the lender's loan is backed by the government, so a less-than-perfect credit application may be accepted. Even so, your income, your monthly debts, and the proposed mortgage payments are all totaled up to see where you land in terms of debt.
The VA loan program is a great benefit for veterans, but coupling it with the First Time Home Buyer tax credit makes the purchase almost too good to be true.
* First time home buyers purchasing any sort of home, new or resale, are eligible for the tax credit. The credit can be used against future federal income taxes, or you can file an amended return for last year and get a check quickly.
* The credit is for an amount equal to 10 percent of the purchase price, up to a maximum of $8000. It is available to anyone, not just veterans. And "first-time" means neither you nor your spouse may have owned a principal residence during the 3 years prior to this purchase.
Here's the kicker: this tax credit is currently set to expire on the first of December, so my advice is to move quickly. There's still time! For more information, talk to any real estate professional or home loan originator.
Courtesy Atlanta Journal-Constitution.
Saturday, June 6, 2009
Things are looking up
More than just real estate.
There was a flurry of unexpectedly good economic news recently, and it gave rise to a little optimism in the real estate sector, something we haven't seen in quite some time. Maybe this is the start of something big.For starters, Federal Reserve Chairman Ben Bernanke said there are signs of a bottom in the housing market and that consumer spending had stabilized. These pieces of the economic puzzle are important because spending represents some 70 percent of our economy, and because confidence pays such a large part in the home buying decision. And remember, these words of encouragement are from a man of few words, and his words are often intentionally vague. Atlanta Federal Reserve president Dennis Lockhart was slightly more reserved, but unmistakably positive last week when he told a group on Jekyll Island that "conditions are now calmer, but it is too soon to breathe easy." OK, no easy breathing yet! But just look at all the good news:New job losses were lower than expected, and well under the benchmark of 600,000 that some economists think signals a declining versus recovering economy. And consumer spending for the first quarter showed unexpected strength after a dismal fourth quarter last year.And even though the stock market is largely unrelated to housing, the recent surge of 35 percent in the S&P 500 Index has boosted consumer confidence at all levels, reflecting Americans belief that the economy is moving toward recovery mode.On top of all this good news, I received the results of the RBC CASH Index. CASH is an acronym for Consumer Attitudes & Spending by Household. Here are their findings in a nutshell:* The RBC Jobs Index saw a rise of 9.2 points in May to 54.4, compared with 45.2 last month. Ratings of 50 or better imply optimism. This is the second consecutive increase in the jobs index following six straight months of decline. Interestingly, it seems that jobs confidence is improving even as overall unemployment is growing across the nation. Expectation for future employment showed the strongest improvement.* The RBC Expectations Index showed that 36 percent of consumers believe the economy will be stronger next month, while only 20 percent expect it will continue to weaken.* their Investment Index rose to 49.6, reflecting an improvement in respondents personal financial conditions and growing comfort with investments and major spending, such as buying a house.And it’s more than just me seeing the writing on the wall. There is a growing belief among financial experts that the recession is over. Barry Knapp, a strategist at Barclays Capital, wrote recently that the economy appears "to be in the sweet spot of a recovery" and that the recession may have ended last month, according to Bloomberg News. Liz Ann Sonders, chief investment strategist at Charles Schwab, said on "Good Morning America" recently that she agrees with that conclusion. "It isn't any brilliant prescience on mine or anybody else's part," Sonders said. "There's certain indicators we can look at to set the turn, and I think we have seen that turn." Sonders warned that unemployment is a lagging indicator and, historically, employment figures don't begin to recover until six months after the end of a recession. That means that this time around, unemployment likely won't peak until the end of this year. But, she added, there are already positive signs on the employment front. Layoffs are slowing, and unemployment claims are starting to edge lower. Meanwhile, there is more good news in housing: "We're hitting some trends that show that we may be approaching a bottom, or we may be at a bottom right now," said Pat Lashinksy, the CEO of online broker ZipRealty. A leading indicator for the housing market is inventory, the number of homes on the market. When the number of homes for sale goes down, prices rise and the market improves. Lashinksy said that's what's happening now. New data from ZipRealty shows that buyers are moving into the housing market at levels not seen in two years. "Inventory levels are actually declining, and median home prices of homes available for sale have actually gone up," Lashinksy said. ZipRealty said that as of right now, it would take 8½ months to sell all the homes currently on the market, down from a high of 11 months in October 2007. Most market watchers feel that an inventory of about six months creates an equilibrium between buyers and sellers. "The fact that inventory is declining is suggesting that soon we may see home prices begin to stabilize. In some markets, it may begin to turn upward. But the downturn in the housing that we've had for the last three years may be coming to an end," said Lawrence Yun, the chief economist for the National Association of Realtors. "Buyers are a lot more engaged," Yun said. "There's an excitement and a passion that hasn't been seen in the last 18 months right now." What's motivating buyers is low interest rates on mortgages, lower home prices and a new $8,000 tax credit for first-time buyers. In addition, some first time buyers in Georgia will qualify for up to $14,000 in additional grants under the Georgia Dream Loan program.So, is this recession over? It’s too soon to tell, but the signs are beginning to look encouraging.
Information from AJC 05/09
There was a flurry of unexpectedly good economic news recently, and it gave rise to a little optimism in the real estate sector, something we haven't seen in quite some time. Maybe this is the start of something big.For starters, Federal Reserve Chairman Ben Bernanke said there are signs of a bottom in the housing market and that consumer spending had stabilized. These pieces of the economic puzzle are important because spending represents some 70 percent of our economy, and because confidence pays such a large part in the home buying decision. And remember, these words of encouragement are from a man of few words, and his words are often intentionally vague. Atlanta Federal Reserve president Dennis Lockhart was slightly more reserved, but unmistakably positive last week when he told a group on Jekyll Island that "conditions are now calmer, but it is too soon to breathe easy." OK, no easy breathing yet! But just look at all the good news:New job losses were lower than expected, and well under the benchmark of 600,000 that some economists think signals a declining versus recovering economy. And consumer spending for the first quarter showed unexpected strength after a dismal fourth quarter last year.And even though the stock market is largely unrelated to housing, the recent surge of 35 percent in the S&P 500 Index has boosted consumer confidence at all levels, reflecting Americans belief that the economy is moving toward recovery mode.On top of all this good news, I received the results of the RBC CASH Index. CASH is an acronym for Consumer Attitudes & Spending by Household. Here are their findings in a nutshell:* The RBC Jobs Index saw a rise of 9.2 points in May to 54.4, compared with 45.2 last month. Ratings of 50 or better imply optimism. This is the second consecutive increase in the jobs index following six straight months of decline. Interestingly, it seems that jobs confidence is improving even as overall unemployment is growing across the nation. Expectation for future employment showed the strongest improvement.* The RBC Expectations Index showed that 36 percent of consumers believe the economy will be stronger next month, while only 20 percent expect it will continue to weaken.* their Investment Index rose to 49.6, reflecting an improvement in respondents personal financial conditions and growing comfort with investments and major spending, such as buying a house.And it’s more than just me seeing the writing on the wall. There is a growing belief among financial experts that the recession is over. Barry Knapp, a strategist at Barclays Capital, wrote recently that the economy appears "to be in the sweet spot of a recovery" and that the recession may have ended last month, according to Bloomberg News. Liz Ann Sonders, chief investment strategist at Charles Schwab, said on "Good Morning America" recently that she agrees with that conclusion. "It isn't any brilliant prescience on mine or anybody else's part," Sonders said. "There's certain indicators we can look at to set the turn, and I think we have seen that turn." Sonders warned that unemployment is a lagging indicator and, historically, employment figures don't begin to recover until six months after the end of a recession. That means that this time around, unemployment likely won't peak until the end of this year. But, she added, there are already positive signs on the employment front. Layoffs are slowing, and unemployment claims are starting to edge lower. Meanwhile, there is more good news in housing: "We're hitting some trends that show that we may be approaching a bottom, or we may be at a bottom right now," said Pat Lashinksy, the CEO of online broker ZipRealty. A leading indicator for the housing market is inventory, the number of homes on the market. When the number of homes for sale goes down, prices rise and the market improves. Lashinksy said that's what's happening now. New data from ZipRealty shows that buyers are moving into the housing market at levels not seen in two years. "Inventory levels are actually declining, and median home prices of homes available for sale have actually gone up," Lashinksy said. ZipRealty said that as of right now, it would take 8½ months to sell all the homes currently on the market, down from a high of 11 months in October 2007. Most market watchers feel that an inventory of about six months creates an equilibrium between buyers and sellers. "The fact that inventory is declining is suggesting that soon we may see home prices begin to stabilize. In some markets, it may begin to turn upward. But the downturn in the housing that we've had for the last three years may be coming to an end," said Lawrence Yun, the chief economist for the National Association of Realtors. "Buyers are a lot more engaged," Yun said. "There's an excitement and a passion that hasn't been seen in the last 18 months right now." What's motivating buyers is low interest rates on mortgages, lower home prices and a new $8,000 tax credit for first-time buyers. In addition, some first time buyers in Georgia will qualify for up to $14,000 in additional grants under the Georgia Dream Loan program.So, is this recession over? It’s too soon to tell, but the signs are beginning to look encouraging.
Information from AJC 05/09
Thursday, April 30, 2009
More than just real estate.
Helping Homeowners
New Details Emerge about ‘Making Home Affordable’ Program
The new Administration has announced details of new efforts to help bring relief to responsible homeowners under the Making Home Affordable Program, including an effort to achieve greater affordability for homeowners by lowering payments on their second mortgages as well as a set of measures to help underwater borrowers stay in their homes. “With these latest program details, we’re offering even more opportunities for borrowers to make their homes more affordable under the Administration’s housing plan,” said Treasury Secretary Tim Geithner. “Ensuring that responsible homeowners can afford to stay in their homes is critical to stabilizing the housing market, which is in turn critical to stabilizing our financial system overall. Every step we take forward is done with that imperative in mind.”
“These new details will make it easier for borrowers to modify or refinance their loans under FHA’s Hope for Homeowners program,” said HUD Secretary Shaun Donovan. “We encourage Congress to enact the necessary legislative changes to make the Hope for Homeowners program an integral part of the Making Home Affordable Program.”
The Second Lien Program, one of the new details, will work in tandem with first lien modifications offered under the Home Affordable Modification Program to deliver a comprehensive affordability solution for struggling borrowers. Second mortgages can create significant challenges in helping borrowers avoid foreclosure, even when a first lien is modified. Up to 50% of at-risk mortgages have second liens, and many properties in foreclosure have more than one lien.
Under the Second Lien Program, when a Home Affordable Modification is initiated on a first lien, servicers participating in the Second Lien Program will automatically reduce payments on the associated second lien according to a pre-set protocol. Alternatively, servicers will have the option to extinguish the second lien in return for a lump sum payment under a pre-set formula determined by Treasury, allowing servicers to target principal extinguishment to the borrowers where extinguishment is most appropriate.
Separately, the Administration has also announced steps to incorporate the Federal Housing Administration’s (FHA) Hope for Homeowners into Making Home Affordable. Hope for Homeowners requires the holder of the mortgage to accept a payoff below the current market value of the home, allowing the borrower to refinance into a new FHA-guaranteed loan. Refinancing into a new loan below the home’s market value takes a borrower from a position of being underwater to having equity in their home. By increasing a homeowner’s equity in the home, Hope for Homeowners can produce a better outcome for borrowers who qualify.
Under the changes recently announced and, when evaluating borrowers for a Home Affordable Modification, servicers will be required to determine eligibility for a Hope for Homeowners refinancing. Where Hope for Homeowners proves to be viable, the servicer must offer this option to the borrower. To ensure proper alignment of incentives, servicers and lenders will receive pay-for-success payments for Hope for Homeowners refinancings similar to those offered for Home Affordable Modifications. These additional supports are designed to work in tandem and take effect with the improved and expanded program under consideration by Congress. The Administration supports legislation to strengthen Hope for Homeowners so that it can function effectively as an integral part of the Making Home Affordable Program.
Making Home Affordable, a comprehensive plan to stabilize the U.S. housing market, was first announced by the Administration on February 18. The three part program includes aggressive measures to support low mortgage rates by strengthening confidence in Fannie Mae and Freddie Mac; a Home Affordable Refinance Program, which will provide new access to refinancing for up to 4 to 5 million homeowners; and a Home Affordable Modification Program, which will reduce monthly payments on existing first lien mortgages for up to 3 to 4 million at-risk homeowners. Two weeks later, the Administration published detailed guidelines for the Home Affordable Modification Program and authorized servicers to begin modifications under the plan immediately. Twelve servicers, including the five largest, have now signed contracts and begun modifications under the program. Between loans covered by these servicers and loans owned or securitized by Fannie Mae or Freddie Mac, more than 75% of all loans in the country are now covered by the Making Home Affordable Program.
Continuing to bolster its outreach around the program, the Administration also announced a new effort to engage directly with homeowners via MakingHomeAffordable.gov.
Homeowners will have the ability to submit individual questions through the website to the Administration’s housing team. Members of the Treasury and HUD staffs will periodically select commonly asked questions and post responses on MakingHomeAffordable.gov.
information from Risemedia 04/09
Helping Homeowners
New Details Emerge about ‘Making Home Affordable’ Program
The new Administration has announced details of new efforts to help bring relief to responsible homeowners under the Making Home Affordable Program, including an effort to achieve greater affordability for homeowners by lowering payments on their second mortgages as well as a set of measures to help underwater borrowers stay in their homes. “With these latest program details, we’re offering even more opportunities for borrowers to make their homes more affordable under the Administration’s housing plan,” said Treasury Secretary Tim Geithner. “Ensuring that responsible homeowners can afford to stay in their homes is critical to stabilizing the housing market, which is in turn critical to stabilizing our financial system overall. Every step we take forward is done with that imperative in mind.”
“These new details will make it easier for borrowers to modify or refinance their loans under FHA’s Hope for Homeowners program,” said HUD Secretary Shaun Donovan. “We encourage Congress to enact the necessary legislative changes to make the Hope for Homeowners program an integral part of the Making Home Affordable Program.”
The Second Lien Program, one of the new details, will work in tandem with first lien modifications offered under the Home Affordable Modification Program to deliver a comprehensive affordability solution for struggling borrowers. Second mortgages can create significant challenges in helping borrowers avoid foreclosure, even when a first lien is modified. Up to 50% of at-risk mortgages have second liens, and many properties in foreclosure have more than one lien.
Under the Second Lien Program, when a Home Affordable Modification is initiated on a first lien, servicers participating in the Second Lien Program will automatically reduce payments on the associated second lien according to a pre-set protocol. Alternatively, servicers will have the option to extinguish the second lien in return for a lump sum payment under a pre-set formula determined by Treasury, allowing servicers to target principal extinguishment to the borrowers where extinguishment is most appropriate.
Separately, the Administration has also announced steps to incorporate the Federal Housing Administration’s (FHA) Hope for Homeowners into Making Home Affordable. Hope for Homeowners requires the holder of the mortgage to accept a payoff below the current market value of the home, allowing the borrower to refinance into a new FHA-guaranteed loan. Refinancing into a new loan below the home’s market value takes a borrower from a position of being underwater to having equity in their home. By increasing a homeowner’s equity in the home, Hope for Homeowners can produce a better outcome for borrowers who qualify.
Under the changes recently announced and, when evaluating borrowers for a Home Affordable Modification, servicers will be required to determine eligibility for a Hope for Homeowners refinancing. Where Hope for Homeowners proves to be viable, the servicer must offer this option to the borrower. To ensure proper alignment of incentives, servicers and lenders will receive pay-for-success payments for Hope for Homeowners refinancings similar to those offered for Home Affordable Modifications. These additional supports are designed to work in tandem and take effect with the improved and expanded program under consideration by Congress. The Administration supports legislation to strengthen Hope for Homeowners so that it can function effectively as an integral part of the Making Home Affordable Program.
Making Home Affordable, a comprehensive plan to stabilize the U.S. housing market, was first announced by the Administration on February 18. The three part program includes aggressive measures to support low mortgage rates by strengthening confidence in Fannie Mae and Freddie Mac; a Home Affordable Refinance Program, which will provide new access to refinancing for up to 4 to 5 million homeowners; and a Home Affordable Modification Program, which will reduce monthly payments on existing first lien mortgages for up to 3 to 4 million at-risk homeowners. Two weeks later, the Administration published detailed guidelines for the Home Affordable Modification Program and authorized servicers to begin modifications under the plan immediately. Twelve servicers, including the five largest, have now signed contracts and begun modifications under the program. Between loans covered by these servicers and loans owned or securitized by Fannie Mae or Freddie Mac, more than 75% of all loans in the country are now covered by the Making Home Affordable Program.
Continuing to bolster its outreach around the program, the Administration also announced a new effort to engage directly with homeowners via MakingHomeAffordable.gov.
Homeowners will have the ability to submit individual questions through the website to the Administration’s housing team. Members of the Treasury and HUD staffs will periodically select commonly asked questions and post responses on MakingHomeAffordable.gov.
information from Risemedia 04/09
Thursday, April 2, 2009
Atlanta Real Estate Investment Market
More than just real estate.
Those of you who are seasoned investors out there will have realized by now that Today’s dire economic circumstances have conspired to produce the perfect real estate storm for buyers and investors. Huge inventory, low interest rates, and highly motivated sellers all combine to make this an ideal time to pick up a house, or two, or even three. But before we all rush out and buy the first house we can find, let’s look at the four most important factors of an investor real estate deal:
LOCATION
If you are looking for a rental property that will pay for itself on a monthly basis, you may be best off looking in lower middle class neighborhoods where most of the owners occupy their homes and keep their homes in relatively good condition.
Gang graffiti and boarded-up doors and windows are signs to avoid, while accessibility to transportation and relatively recent construction make for good rental income properties. Good public schools are also an important feature for many prospective renters.
Another desirable feature related to location is a neighborhood where most of the homes are similar in size and amenities. You want to buy in a neighborhood where the other properties won’t pull down your value due to wide-ranging sales prices.
CONDITION
Try to avoid neighborhoods where most of the homes are less than three bedrooms and two baths, or where most of the construction is pre-1950. Homes more than fifty years old will eventually need almost all systems updated, and that is an expense to avoid in a rental situation.
Homes less than ten years old have almost all up-to-date systems, and shouldn’t need major renovations any time soon. In addition, newer homes sometimes offer space for expansion, an inexpensive way to add a bedroom or office.
In an ideal situation, the home should need no work before the renter moves in. However, in today’s real estate market, the condition is where you are going to find the greatest degree of variation. At no time in the past thirty years has there been such a large number of homes on the market needing significant repairs.
Many of these homes are bank owned, and some are uninhabitable. Others may need nothing more than paint and carpet. Being able to distinguish between the two extremes is critical to your success in finding a great deal. At the very least, make all offers
contingent upon a full inspection of the property and a satisfactory estimate for
all needed repairs.
PRICE
The glut of bank-owned homes has, in my opinion, kicked the floor out from under the Atlanta residential real estate market. We don’t know what anything is worth, because so many of the comparable sales that appraisers use a re distressed sales.
But if you can get a price discount in the 40% to 50% range, it really doesn’t take a great investor to see that there is plenty of room for upside profit, both in the monthly cash flow and in the long term resale price. I believe that most lenders had, until recently, hoped for a “Resolution Trust Company style” bailout from the federal government. But now that the Obama administration has indicated that troubled bank assets will not be
purchased directly, pressure to sell is mounting on a daily basis. Seller motivation is growing. Investors making initial offers on bank-owned homes should be especially
careful to stay in touch with the current market of bank resales. Discounts of 25% are not uncommon, and sales at 50 cents on the dollar are being seen by investors. My advice is to start low, then be prepared to negotiate up.
FINANCING
This is the big wildcard for investment property, because the current Fannie Mae “ten property rule” has kept many veteran investors on the sidelines. But if FNMA were to relax investor guidelines, or if banks began offering any kind of reasonable seller financing, the floor under housing prices in Atlanta could be re-established
fairly quickly.
All but the most ardent “doom and gloomers” believe that the current condition of variable home values will end sooner rather than later, and anyone who can lock in a low price now will be glad they did. But the real key is how to finance that low price.
A super-low price combined with a great financing makes for a fabulous real estate investment opportunity. And I believe the solution to this problem is seller financing. I am already starting to get reports of banks selling their houses and agreeing to carry back some sort of financing. The key for investors is not necessarily a 30-year fixed rate loan at 6% interest with nothing down, although that would be nice. Instead, the key is for banks to be able to convert their non-performing assets (the vacant houses) into performing assets (loans requiring a substantial down payment and reasonable qualification guidelines). These loans can be good for the banks and good for the borrower, and they could still be attractive with terms as short as five to seven years. The investment community is ready, but needs the financing to act. Once the banks make this leap of logic, the huge oversupply of vacant houses in Atlanta can begin to disappear, and we can get on with the business of re-establishing a market for real estate.
Source John Adams - March 09
Those of you who are seasoned investors out there will have realized by now that Today’s dire economic circumstances have conspired to produce the perfect real estate storm for buyers and investors. Huge inventory, low interest rates, and highly motivated sellers all combine to make this an ideal time to pick up a house, or two, or even three. But before we all rush out and buy the first house we can find, let’s look at the four most important factors of an investor real estate deal:
LOCATION
If you are looking for a rental property that will pay for itself on a monthly basis, you may be best off looking in lower middle class neighborhoods where most of the owners occupy their homes and keep their homes in relatively good condition.
Gang graffiti and boarded-up doors and windows are signs to avoid, while accessibility to transportation and relatively recent construction make for good rental income properties. Good public schools are also an important feature for many prospective renters.
Another desirable feature related to location is a neighborhood where most of the homes are similar in size and amenities. You want to buy in a neighborhood where the other properties won’t pull down your value due to wide-ranging sales prices.
CONDITION
Try to avoid neighborhoods where most of the homes are less than three bedrooms and two baths, or where most of the construction is pre-1950. Homes more than fifty years old will eventually need almost all systems updated, and that is an expense to avoid in a rental situation.
Homes less than ten years old have almost all up-to-date systems, and shouldn’t need major renovations any time soon. In addition, newer homes sometimes offer space for expansion, an inexpensive way to add a bedroom or office.
In an ideal situation, the home should need no work before the renter moves in. However, in today’s real estate market, the condition is where you are going to find the greatest degree of variation. At no time in the past thirty years has there been such a large number of homes on the market needing significant repairs.
Many of these homes are bank owned, and some are uninhabitable. Others may need nothing more than paint and carpet. Being able to distinguish between the two extremes is critical to your success in finding a great deal. At the very least, make all offers
contingent upon a full inspection of the property and a satisfactory estimate for
all needed repairs.
PRICE
The glut of bank-owned homes has, in my opinion, kicked the floor out from under the Atlanta residential real estate market. We don’t know what anything is worth, because so many of the comparable sales that appraisers use a re distressed sales.
But if you can get a price discount in the 40% to 50% range, it really doesn’t take a great investor to see that there is plenty of room for upside profit, both in the monthly cash flow and in the long term resale price. I believe that most lenders had, until recently, hoped for a “Resolution Trust Company style” bailout from the federal government. But now that the Obama administration has indicated that troubled bank assets will not be
purchased directly, pressure to sell is mounting on a daily basis. Seller motivation is growing. Investors making initial offers on bank-owned homes should be especially
careful to stay in touch with the current market of bank resales. Discounts of 25% are not uncommon, and sales at 50 cents on the dollar are being seen by investors. My advice is to start low, then be prepared to negotiate up.
FINANCING
This is the big wildcard for investment property, because the current Fannie Mae “ten property rule” has kept many veteran investors on the sidelines. But if FNMA were to relax investor guidelines, or if banks began offering any kind of reasonable seller financing, the floor under housing prices in Atlanta could be re-established
fairly quickly.
All but the most ardent “doom and gloomers” believe that the current condition of variable home values will end sooner rather than later, and anyone who can lock in a low price now will be glad they did. But the real key is how to finance that low price.
A super-low price combined with a great financing makes for a fabulous real estate investment opportunity. And I believe the solution to this problem is seller financing. I am already starting to get reports of banks selling their houses and agreeing to carry back some sort of financing. The key for investors is not necessarily a 30-year fixed rate loan at 6% interest with nothing down, although that would be nice. Instead, the key is for banks to be able to convert their non-performing assets (the vacant houses) into performing assets (loans requiring a substantial down payment and reasonable qualification guidelines). These loans can be good for the banks and good for the borrower, and they could still be attractive with terms as short as five to seven years. The investment community is ready, but needs the financing to act. Once the banks make this leap of logic, the huge oversupply of vacant houses in Atlanta can begin to disappear, and we can get on with the business of re-establishing a market for real estate.
Source John Adams - March 09
Friday, March 6, 2009
Foreclosure Prevention Plan
More than just real estate.
Dear friends, below is information taken from an article by James Haggerty of the Wall Street Journal, hopefully it will help you to answer some of the common questions about the new foreclosure prevention plan.
What do these programs involve?
One component calls for reducing payments for distressed borrowers through modifications of loan terms, known as loan mods. A second involves refinancing mortgages for some people who are current on their payments but have little or no equity in their homes.
When does this start?
Immediately.
How do I know whether I qualify for a loan modification?
For starters, this program applies only to your primary residence. That could be a home for one to four families, condo, cooperative apartment or manufactured home affixed to a foundation. It doesn't apply to second homes or investment properties, and the home can't be vacant or condemned. It also doesn't apply to mortgages on one-unit homes whose balances exceed $729,750.
And it isn't for people who can easily afford to pay their loans. You qualify only if your mortgage payment is more than 31% of your pretax monthly income. The monthly payment includes principal, interest, taxes, insurance and homeowner association or condominium fees. Income includes wages, salary, overtime, fees, commissions, tips, Social Security, pensions and other items.
You may qualify whether or not you are up to date with your payments, but you will need to show that you don't have sufficient cash or other readily available assets to meet your current payments.
If I think I may qualify, what's the first step?
Call your loan servicer, the company that sends you your monthly mortgage bill. If you want a counselor to help you, you can request free counseling from approved counseling organizations by dialing the Hope Hotline at 888-995-4673. Avoid firms that charge you a fee for helping you get a loan mod.
Aside from lower payments, what are the benefits of participating?
As long as participants stay current on the modified loans, they can get reductions of as much as $1,000 each year in their principal balance for five years.
Can everyone with a hardship be helped?
No. Servicers will apply a "net present value" test to determine whether a loan modification is in the financial interests of the lender or investor who owns the loan. If it isn't, you may not qualify.
Do I have to pay a fee for a loan mod?
No.
How do I know whether I qualify for the refinancing part of this plan?
You must be current on your payments and your loan must be owned or guaranteed by government-backed mortgage companies Fannie Mae or Freddie Mac.
These refinancings are designed for cases in which the loan balance is between 80% and 105% of the estimated value of your home. (Those below 80% should be able to get refinanced without the help of this program by contacting lenders or mortgage brokers.) Loan servicers will use computer programs or other means to estimate the value of your home.
These refinancings also are available for second homes and investment properties in some cases.
How do I find out if my loan is owned or guaranteed by Fannie or Freddie?
Your loan servicer or counselor should be able to determine that. On your own you can contact Fannie by calling 1-800-7FANNIE or visiting this Web site: www.fanniemae.com/homeaffordable. To reach Freddie, call 1-800-FREDDIE or go to www.freddiemac.com/avoidforeclosure.
Do I have to pay a fee for a refinanced loan?
Lenders or mortgage brokers may charge fees, which are likely to vary.
How long will these programs last?
The modification plan ends Dec. 31, 2012, and loans can be reworked only one time under this program. The refinance program ends in June 2010.
Where can I get more information?
The U.S. Treasury has provided information at www.financialstability.gov.
courtesy James R. Hagerty Printed in The Wall Street Journal, 03.06.09
Dear friends, below is information taken from an article by James Haggerty of the Wall Street Journal, hopefully it will help you to answer some of the common questions about the new foreclosure prevention plan.
What do these programs involve?
One component calls for reducing payments for distressed borrowers through modifications of loan terms, known as loan mods. A second involves refinancing mortgages for some people who are current on their payments but have little or no equity in their homes.
When does this start?
Immediately.
How do I know whether I qualify for a loan modification?
For starters, this program applies only to your primary residence. That could be a home for one to four families, condo, cooperative apartment or manufactured home affixed to a foundation. It doesn't apply to second homes or investment properties, and the home can't be vacant or condemned. It also doesn't apply to mortgages on one-unit homes whose balances exceed $729,750.
And it isn't for people who can easily afford to pay their loans. You qualify only if your mortgage payment is more than 31% of your pretax monthly income. The monthly payment includes principal, interest, taxes, insurance and homeowner association or condominium fees. Income includes wages, salary, overtime, fees, commissions, tips, Social Security, pensions and other items.
You may qualify whether or not you are up to date with your payments, but you will need to show that you don't have sufficient cash or other readily available assets to meet your current payments.
If I think I may qualify, what's the first step?
Call your loan servicer, the company that sends you your monthly mortgage bill. If you want a counselor to help you, you can request free counseling from approved counseling organizations by dialing the Hope Hotline at 888-995-4673. Avoid firms that charge you a fee for helping you get a loan mod.
Aside from lower payments, what are the benefits of participating?
As long as participants stay current on the modified loans, they can get reductions of as much as $1,000 each year in their principal balance for five years.
Can everyone with a hardship be helped?
No. Servicers will apply a "net present value" test to determine whether a loan modification is in the financial interests of the lender or investor who owns the loan. If it isn't, you may not qualify.
Do I have to pay a fee for a loan mod?
No.
How do I know whether I qualify for the refinancing part of this plan?
You must be current on your payments and your loan must be owned or guaranteed by government-backed mortgage companies Fannie Mae or Freddie Mac.
These refinancings are designed for cases in which the loan balance is between 80% and 105% of the estimated value of your home. (Those below 80% should be able to get refinanced without the help of this program by contacting lenders or mortgage brokers.) Loan servicers will use computer programs or other means to estimate the value of your home.
These refinancings also are available for second homes and investment properties in some cases.
How do I find out if my loan is owned or guaranteed by Fannie or Freddie?
Your loan servicer or counselor should be able to determine that. On your own you can contact Fannie by calling 1-800-7FANNIE or visiting this Web site: www.fanniemae.com/homeaffordable. To reach Freddie, call 1-800-FREDDIE or go to www.freddiemac.com/avoidforeclosure.
Do I have to pay a fee for a refinanced loan?
Lenders or mortgage brokers may charge fees, which are likely to vary.
How long will these programs last?
The modification plan ends Dec. 31, 2012, and loans can be reworked only one time under this program. The refinance program ends in June 2010.
Where can I get more information?
The U.S. Treasury has provided information at www.financialstability.gov.
courtesy James R. Hagerty Printed in The Wall Street Journal, 03.06.09
Thursday, February 26, 2009
What are the details of the $8,000 Tax credit
More than just real estate.
Dear friends,
Below are some Q and A regarding the recently announced tax credit.
Hopefully this will answer most of your questions, if not feel free to contact me.
Q&A on $8,000 First-Time Home Buyer Tax Credit Q: Who is eligible to use the tax credit? A: The $8,000 tax credit is available for first-time home buyers only. The law defines “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase. All U.S. citizens who file taxes are eligible to participate in the program.
Q: Are there any payback provisions? A: The tax credit is a true credit. It does not have to be repaid. The only repayment requirement is if the home owner sold the home within three years after the purchase.
Q: Are there income limits to qualify for the credit? A: Home buyers who file as single or head-of-household taxpayers can claim the full $8,000 credit if their modified adjusted gross income (MAGI) is less than $75,000. For married couples filing a joint return, the income limit doubles to $150,000. Single or head-of-household taxpayers who earn between $75,000 and $95,000 are eligible to receive a partial first-time home buyer tax credit. Married couples who earn between $150,000 and $170,000 are eligible to receive a partial first-time home buyer tax credit. The credit is not available for single taxpayers whose MAGI is greater than $95,000 and married couples with a MAGI that exceeds $170,000.
Q: What are the effective dates for the tax credit? A: First-time home buyers would receive an $8,000 tax credit for the purchase of any home on or after January 1, 2009 and before December 1, 2009. To qualify, you must actually close on the sale of the home during this period.
Q: Is the tax credit refundable? A: Yes. A refundable credit means that if you pay less than $8,000 in federal income taxes, then the government will write you a check for the difference. For example, if you owe $5,000 in federal income taxes, you would pay nothing to the IRS and receive a $3,000 payment from the government. If you are due to receive a $1,000 tax refund from the government, your refund would grow to $9,000 ($1,000 plus $8,000 from the home buyer tax credit).Q: What years can buyers apply the tax credit to their tax returns? A: Buyers can take the tax credit on their 2008 or 2009 income tax return.
Q: What types of homes qualify for the tax credit? A: All homes, whether single-family, townhomes or condominium apartments will qualify, provided that the home will be used as a principal residence and the buyer has not owned a principal residence in the prior three years. This also includes newly-constructed homes.
Q: Where can I find more details on the tax credit? A: NAHB has a consumer Web site that provides comprehensive information on the tax credit. The Web site is http://www.federalhousingtaxcredit.com/ .
Courtesy of John Adams 02/26/09. http://www.money99.com/
Dear friends,
Below are some Q and A regarding the recently announced tax credit.
Hopefully this will answer most of your questions, if not feel free to contact me.
Q&A on $8,000 First-Time Home Buyer Tax Credit Q: Who is eligible to use the tax credit? A: The $8,000 tax credit is available for first-time home buyers only. The law defines “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase. All U.S. citizens who file taxes are eligible to participate in the program.
Q: Are there any payback provisions? A: The tax credit is a true credit. It does not have to be repaid. The only repayment requirement is if the home owner sold the home within three years after the purchase.
Q: Are there income limits to qualify for the credit? A: Home buyers who file as single or head-of-household taxpayers can claim the full $8,000 credit if their modified adjusted gross income (MAGI) is less than $75,000. For married couples filing a joint return, the income limit doubles to $150,000. Single or head-of-household taxpayers who earn between $75,000 and $95,000 are eligible to receive a partial first-time home buyer tax credit. Married couples who earn between $150,000 and $170,000 are eligible to receive a partial first-time home buyer tax credit. The credit is not available for single taxpayers whose MAGI is greater than $95,000 and married couples with a MAGI that exceeds $170,000.
Q: What are the effective dates for the tax credit? A: First-time home buyers would receive an $8,000 tax credit for the purchase of any home on or after January 1, 2009 and before December 1, 2009. To qualify, you must actually close on the sale of the home during this period.
Q: Is the tax credit refundable? A: Yes. A refundable credit means that if you pay less than $8,000 in federal income taxes, then the government will write you a check for the difference. For example, if you owe $5,000 in federal income taxes, you would pay nothing to the IRS and receive a $3,000 payment from the government. If you are due to receive a $1,000 tax refund from the government, your refund would grow to $9,000 ($1,000 plus $8,000 from the home buyer tax credit).Q: What years can buyers apply the tax credit to their tax returns? A: Buyers can take the tax credit on their 2008 or 2009 income tax return.
Q: What types of homes qualify for the tax credit? A: All homes, whether single-family, townhomes or condominium apartments will qualify, provided that the home will be used as a principal residence and the buyer has not owned a principal residence in the prior three years. This also includes newly-constructed homes.
Q: Where can I find more details on the tax credit? A: NAHB has a consumer Web site that provides comprehensive information on the tax credit. The Web site is http://www.federalhousingtaxcredit.com/ .
Courtesy of John Adams 02/26/09. http://www.money99.com/
Sunday, February 22, 2009
Your personal stimulus tax break
More than just real estate.
Roughly 97% of American households could see tax savings as a result of the American Recovery and Reinvestment Act, according to a new analysis by a nonpartisan research group.
The Tax Policy Center crunched the numbers and concluded that the average savings would be $1,179. But how much a household actually gets depends on income, marital status and whether a filer has children. The savings range from a few hundred dollars to several thousand.
The law, which President Obama signed on Tuesday, contains a range of tax breaks for individuals. Those likely to affect the greatest number of households are the new Making Work Pay credit worth up to $400 ($800 for joint filers); a patch to protect middle- and upper-middle-income families from having to pay the Alternative Minimum Tax; and expansions of the earned income tax credit and the child tax credit for low-income families.
There are also breaks that address specific situations: a new credit for first-time home buyers, a sales tax deduction for car buyers and a new credit to help pay for college tuition. For people receiving unemployment benefits, the first $2,400 will be tax free.
On Saturday, President Obama said the government had already taken action on the broadest of the law's cuts -- the Making Work Pay.
The Treasury Department has told employers to reduce the amount of taxes withheld from paychecks by April 1. Treasury estimates that a typical family will begin taking home about $65 more per month, according to Obama.
"Never before in our history has a tax cut taken effect faster or gone to so many hardworking Americans," Obama said in his weekly video and radio address.
In addition, the economic recovery plan contains a host of tax breaks for small businesses.
The Tax Policy Center used a representative sampling of all tax filers and non-filers, including information on their income, their spending and their demographics. And then they applied the various tax provisions for which those in the sample pool qualify.
Some tax-saving scenarios
A single person with no children making between $20,000 and $30,000 would see a 12.5% reduction in his or her tax liability for an annual savings of $453. The same person making between $50,000 and $75,000 would see a 4.6% drop, or $626.
At the upper income ranges, someone with income between $100,000 and $200,000 would see a 2.1% drop, which translates into $706.
With or without kids, a married couple filing jointly making between $50,000 and $75,000 could see a 10.5% drop for a savings of $991. Those making between $75,000 and $100,000 would see their tax liability go down 9.1%, or $1,457.
Couples with very high incomes -- between $200,000 to $500,000 -- could see a 7.5% decline in their tax bill, or $5,645.
Households with children, regardless of the parent's marital status, would see savings on their tax bill averaging 9.7% of their tax liability, or $1,975.
When you'll see savings
The first tax credit filers will enjoy is the Making Work Pay credit, which will show up in increments in people's paychecks starting in April.
In some instances, such as with the first time home buyer's tax credit, the money can be claimed on one's 2008 tax return if the home purchase occurs between Jan. 1 and before Nov. 30 of this year.
But in many cases, a household won't see some of their stimulus savings until they file their 2009 returns, which they can't do until 2010.
Of course what filers' save on their federal taxes under stimulus may be muted by the fact that their cities and states -- facing steep budget shortfalls that will be lessened but not eliminated by stimulus funding -- may end up raising taxes and fees.
Source; CNN Money Feb 09.
Roughly 97% of American households could see tax savings as a result of the American Recovery and Reinvestment Act, according to a new analysis by a nonpartisan research group.
The Tax Policy Center crunched the numbers and concluded that the average savings would be $1,179. But how much a household actually gets depends on income, marital status and whether a filer has children. The savings range from a few hundred dollars to several thousand.
The law, which President Obama signed on Tuesday, contains a range of tax breaks for individuals. Those likely to affect the greatest number of households are the new Making Work Pay credit worth up to $400 ($800 for joint filers); a patch to protect middle- and upper-middle-income families from having to pay the Alternative Minimum Tax; and expansions of the earned income tax credit and the child tax credit for low-income families.
There are also breaks that address specific situations: a new credit for first-time home buyers, a sales tax deduction for car buyers and a new credit to help pay for college tuition. For people receiving unemployment benefits, the first $2,400 will be tax free.
On Saturday, President Obama said the government had already taken action on the broadest of the law's cuts -- the Making Work Pay.
The Treasury Department has told employers to reduce the amount of taxes withheld from paychecks by April 1. Treasury estimates that a typical family will begin taking home about $65 more per month, according to Obama.
"Never before in our history has a tax cut taken effect faster or gone to so many hardworking Americans," Obama said in his weekly video and radio address.
In addition, the economic recovery plan contains a host of tax breaks for small businesses.
The Tax Policy Center used a representative sampling of all tax filers and non-filers, including information on their income, their spending and their demographics. And then they applied the various tax provisions for which those in the sample pool qualify.
Some tax-saving scenarios
A single person with no children making between $20,000 and $30,000 would see a 12.5% reduction in his or her tax liability for an annual savings of $453. The same person making between $50,000 and $75,000 would see a 4.6% drop, or $626.
At the upper income ranges, someone with income between $100,000 and $200,000 would see a 2.1% drop, which translates into $706.
With or without kids, a married couple filing jointly making between $50,000 and $75,000 could see a 10.5% drop for a savings of $991. Those making between $75,000 and $100,000 would see their tax liability go down 9.1%, or $1,457.
Couples with very high incomes -- between $200,000 to $500,000 -- could see a 7.5% decline in their tax bill, or $5,645.
Households with children, regardless of the parent's marital status, would see savings on their tax bill averaging 9.7% of their tax liability, or $1,975.
When you'll see savings
The first tax credit filers will enjoy is the Making Work Pay credit, which will show up in increments in people's paychecks starting in April.
In some instances, such as with the first time home buyer's tax credit, the money can be claimed on one's 2008 tax return if the home purchase occurs between Jan. 1 and before Nov. 30 of this year.
But in many cases, a household won't see some of their stimulus savings until they file their 2009 returns, which they can't do until 2010.
Of course what filers' save on their federal taxes under stimulus may be muted by the fact that their cities and states -- facing steep budget shortfalls that will be lessened but not eliminated by stimulus funding -- may end up raising taxes and fees.
Source; CNN Money Feb 09.
Tuesday, February 17, 2009
Property Tax relief
More than just real estate.
The Georgia Senate recently passed two property tax-relief bills, overcoming criticism from minority Democrats and some Republicans that the measures were unnecessary and would raise taxes on businesses.
Senators voted 40-14 to double Georgia’s homestead property tax exemption from $2,000 to $4,000. A few minutes later, legislation already passed by the House to preserve the state’s Homeowners Tax Relief Grant program this year cleared the Senate 29-24.
Mortgage rates fell during the past week, pushed lower from the uncertainty stemming from the bank bailout plan unveiled Tuesday.
The average 30-year fixed mortgage rate fell to 5.34% from 5.70% for the week ended Feb. 11, according to Bankrate.com.
The average 15-year fixed rate mortgage sank to 5.03% from 5.31%, and the average jumbo 30-year fixed rate slipped to 6.98% from 7.12%.
Adjustable rate mortgages also dropped over the past week, with the average 1-year ARM falling to 5.67% from 5.73% and the 5/1 ARM sinking to 5.37% from 5.5%.
Meanwhile, foreclosure filings more than doubled in the first three months of 2008, spiking 112%. So far this year 156,463 families have lost their homes to repossessions. Many markets won't hit bottom till late 2009 or even 2010.
Pity the residents of Stockton, Calif., whose homes are likely to lose more than half of their 2006 value. But if you happen to live in Texas, congratulations: The housing tornado passed you by.
The Obama administration is looking at subsidizing the mortgage payments of struggling borrowers before they default, according to sources familiar with the discussions.
If it comes to pass, the program would blaze a new trail in the federal government's foreclosure prevention initiatives. Until now, the efforts have focused on helping those already behind in their payments through interest-rate reductions and other loan modifications. The Bush administration had not committed any money to helping borrowers.
Obama, however, has pledged to spend at least $50 billion to help borrowers in trouble. Treasury Secretary Tim Geithner said Tuesday that the administration would release its plan within a few weeks. He and Housing Secretary Shaun Donovan have been meeting with banks, housing advocates and trade organizations this week to listen to their foreclosure prevention proposals.
Details remain scarce, but at this point the subsidy plan entails having struggling homeowners take an affordability test and undergo a re-appraisal to see if they are eligible. The subsidy would allow servicers to adjust the loan terms without having the mortgage's investors take a loss, which should make them more open to the loan modification.
Assisting borrowers before they default would help stop the wave of foreclosures, which are estimated to top two million this year. That, in turn, will help stabilize home prices.
"This will help put a floor on home values," said one person familiar with the negotiations.
Obama's plan is also likely to include ramping up the streamlining of modifications for borrowers already in default. Already, several banks and Fannie Mae and Freddie Mac are working with homeowners to make their monthly payments more affordable by reducing interest rates, lengthening loan terms and deferring principal to the end of the loan
The Georgia Senate recently passed two property tax-relief bills, overcoming criticism from minority Democrats and some Republicans that the measures were unnecessary and would raise taxes on businesses.
Senators voted 40-14 to double Georgia’s homestead property tax exemption from $2,000 to $4,000. A few minutes later, legislation already passed by the House to preserve the state’s Homeowners Tax Relief Grant program this year cleared the Senate 29-24.
Mortgage rates fell during the past week, pushed lower from the uncertainty stemming from the bank bailout plan unveiled Tuesday.
The average 30-year fixed mortgage rate fell to 5.34% from 5.70% for the week ended Feb. 11, according to Bankrate.com.
The average 15-year fixed rate mortgage sank to 5.03% from 5.31%, and the average jumbo 30-year fixed rate slipped to 6.98% from 7.12%.
Adjustable rate mortgages also dropped over the past week, with the average 1-year ARM falling to 5.67% from 5.73% and the 5/1 ARM sinking to 5.37% from 5.5%.
Meanwhile, foreclosure filings more than doubled in the first three months of 2008, spiking 112%. So far this year 156,463 families have lost their homes to repossessions. Many markets won't hit bottom till late 2009 or even 2010.
Pity the residents of Stockton, Calif., whose homes are likely to lose more than half of their 2006 value. But if you happen to live in Texas, congratulations: The housing tornado passed you by.
The Obama administration is looking at subsidizing the mortgage payments of struggling borrowers before they default, according to sources familiar with the discussions.
If it comes to pass, the program would blaze a new trail in the federal government's foreclosure prevention initiatives. Until now, the efforts have focused on helping those already behind in their payments through interest-rate reductions and other loan modifications. The Bush administration had not committed any money to helping borrowers.
Obama, however, has pledged to spend at least $50 billion to help borrowers in trouble. Treasury Secretary Tim Geithner said Tuesday that the administration would release its plan within a few weeks. He and Housing Secretary Shaun Donovan have been meeting with banks, housing advocates and trade organizations this week to listen to their foreclosure prevention proposals.
Details remain scarce, but at this point the subsidy plan entails having struggling homeowners take an affordability test and undergo a re-appraisal to see if they are eligible. The subsidy would allow servicers to adjust the loan terms without having the mortgage's investors take a loss, which should make them more open to the loan modification.
Assisting borrowers before they default would help stop the wave of foreclosures, which are estimated to top two million this year. That, in turn, will help stabilize home prices.
"This will help put a floor on home values," said one person familiar with the negotiations.
Obama's plan is also likely to include ramping up the streamlining of modifications for borrowers already in default. Already, several banks and Fannie Mae and Freddie Mac are working with homeowners to make their monthly payments more affordable by reducing interest rates, lengthening loan terms and deferring principal to the end of the loan
Wednesday, January 28, 2009
Inauguration time
More than just Real Estate.
Thanks to the procurement abilities and connections of CJ Bland, the founder and CEO of Minority Professional Network, I was able to witness first hand the Inauguration of the 44th President of the USA in Washington DC. CJ also managed to get me a ticket one of the official balls 'The Southern Ball', below are a few pictures of the evening. MPN provides the premiere web-based interactive global Career, Economic, and Lifestyle Connection™ marketing portal and resource network for
progressive multicultural and women professionals. The MPN web portal - http://www.minorityprofessionalnetwork.com/ionalnetwork.com/ is regularly visited by millions of entrepreneurs, consumers, community leaders, corporate professionals, politicians and other progressive multicultural and women professionals and students throughout the USA and around the world.
MPN provides the premiere web-based interactive global Career, Economic, and Lifestyle Connection™ marketing portal and resource network for progressive multicultural and women professionals. The MPN web portal - http://www.minorityprofessionalnetwork.com/ is regularly visited by millions of entrepreneurs, consumers, community leaders, corporate professionals, politicians and other progressive multicultural and women professionals and students throughout the USA and around the world.
Thanks to the procurement abilities and connections of CJ Bland, the founder and CEO of Minority Professional Network, I was able to witness first hand the Inauguration of the 44th President of the USA in Washington DC. CJ also managed to get me a ticket one of the official balls 'The Southern Ball', below are a few pictures of the evening. MPN provides the premiere web-based interactive global Career, Economic, and Lifestyle Connection™ marketing portal and resource network for
progressive multicultural and women professionals. The MPN web portal - http://www.minorityprofessionalnetwork.com/ionalnetwork.com/ is regularly visited by millions of entrepreneurs, consumers, community leaders, corporate professionals, politicians and other progressive multicultural and women professionals and students throughout the USA and around the world.
MPN provides the premiere web-based interactive global Career, Economic, and Lifestyle Connection™ marketing portal and resource network for progressive multicultural and women professionals. The MPN web portal - http://www.minorityprofessionalnetwork.com/ is regularly visited by millions of entrepreneurs, consumers, community leaders, corporate professionals, politicians and other progressive multicultural and women professionals and students throughout the USA and around the world.
Thursday, January 15, 2009
Why should I use a Realtor?
Happy New year everyone!! I wish you all Health, Happiness and prosperity. Lets make it a great year.
I will start by reminding you of some of the reasons why you need to use a Real Estate professional in your Real Estate tranactions Surveys show that many homeowners and homebuyers are not aware of the true value a REALTOR® provides during the course of a real estate transaction. The list here is just a baseline since the services may vary within each brokerage and each market. In Atlanta and around the USA, many REALTORS® routinely provide a wide variety of additional services that are as varied as the nature of each transaction. By the same token, some transactions may not require some of these steps to be equally successful. However, most would agree that given the unexpected complications that can arise, it’s far better to know about a step and make an intelligent, informed decision to skip it, than to not know the possibility even existed. The Critical Role of the REALTOR® – 180 Steps Listed here are 180 typical actions, research steps, procedures, processes and review stages in a successful residential real estate transaction that are normally provided by full service real estate brokerages in return for their sales commission. Depending on the transaction, some may take minutes, hours, or even days to complete, while some may not be needed. More importantly, they reflect the level of skill, knowledge and attention to detail required in today’s real estate transaction, underscoring the importance of having help and guidance from someone who fully understands the process – a REALTOR®.
Pre-Listing Activities
1 Make appointment with seller for listing presentation
2 Send seller a written or e-mail confirmation of listing appointment and call to confirm
3 Review pre-appointment questions
4 Research all comparable currently listed properties
5 Research sales activity for past 18 months from MLS and public records databases
6 Research "Average Days on Market" for this property of this type, price range and location
7 Download and review property tax roll information
8 Prepare "Comparable Market Analysis" (CMA) to establish fair market value
9 Obtain copy of subdivision plat/complex lay-out
10 Research property's ownership & deed type
11 Research property's public record information for lot size & dimensions
12 Research and verify legal description
13 Research property's land use coding and deed restrictions
14 Research property's current use and zoning
15 Verify legal names of owner(s) in county's public property records
16 Prepare listing presentation package with above materials and HomeTrack™ information
17 Perform exterior "Curb Appeal Assessment" of subject property
18 Compile and assemble formal file on property
19 Confirm current public schools and explain impact of schools on market value
20 Review listing appointment checklist to ensure all steps and actions have been completed
Listing Appointment Presentation
21 Give seller an overview of current market conditions and projections
22 Review agent's and company's credentials and accomplishments in the market
23 Present company's profile and position or "niche" in the marketplace
24 Present CMA Results To Seller, including Comparables, Solds, Current Listings & Expireds
25 Offer pricing strategy based on professional judgment and interpretation of current market conditions
26 Discuss Goals With Seller To Market Effectively
27 Explain market power and benefits of Multiple Listing Service
28 Explain market power of web marketing, IDX and REALTOR.com
29 Explain the work the brokerage and agent do "behind the scenes" and agent's availability on weekends
30 Explain agent's role in taking calls to screen for qualified buyers and protect seller from curiosity seekers
31 Present and discuss strategic master marketing plan
32 Explain different agency relationships and determine seller's preference
33 Review and explain all clauses in Listing Contract & Addendum and obtain seller's signature
Once Property is Under Listing Agreement
34 Review current title information
35 Measure overall and heated square footage
36 Measure interior room sizes
37 Confirm lot size via owner's copy of certified survey, if available
38 Note any and all unrecorded property lines, agreements, easements
39 Obtain house plans, if applicable and available
40 Review house plans and make copy
41 Order plat map for retention in property's listing file
42 Prepare showing instructions for buyers' agents and agree on showing time window with seller
43 Obtain current mortgage loan(s) information: companies and & loan account numbers
44 Verify current loan information with lender(s)
45 Check assumability of loan(s) and any special requirements
46 Discuss possible buyer financing alternatives and options with seller
47 Review current appraisal if available
48 Identify Home Owner Association manager if applicable
49 Verify Home Owner Association Fees with manager - mandatory or optional and current annual fee
50 Order copy of Homeowner Association bylaws, if applicable
51 Research electricity availability and supplier's name and phone number
52 Calculate average utility usage from last 12 months of bills
53 Research and verify city sewer/septic tank system
54 Water System: Calculate average water fees or rates from last 12 months of bills )
55 Well Water: Confirm well status, depth and output from Well Report
56 Natural Gas: Research/verify availability and supplier's name and phone number
57 Verify security system, current term of service and whether owned or leased
58 Verify if seller has transferable Termite Bond
59 Ascertain need for lead-based paint disclosure
60 Prepare detailed list of property amenities and assess market impact
61 Prepare detailed list of property's "Inclusions & Conveyances with Sale"
62 Compile list of completed repairs and maintenance items
63 Send "Vacancy Checklist" to seller if property is vacant
64 Explain benefits of Home Owner Warranty to seller
65 Assist sellers with completion and submission of Home Owner Warranty Application
66 When received, place Home Owner Warranty in property file for conveyance at time of sale
67 Have extra key made for lockbox
68 Verify if property has rental units involved. And if so:
69 * Make copies of all leases for retention in listing file
70 * Verify all rents & deposits
71 * Inform tenants of listing and discuss how showings will be handled
72 Arrange for installation of yard sign
73 Assist seller with completion of Seller's Disclosure form
74 "New Listing Checklist" Completed
75 Review results of Curb Appeal Assessment with seller and provide suggestions to improve salability
76 Review results of Interior Décor Assessment and suggest changes to shorten time on market
77 Load listing into transaction management software program
Entering Property in Multiple Listing Service Database
78 Prepare MLS Profile Sheet -- Agents is responsible for "quality control" and accuracy of listing data
79 Enter property data from Profile Sheet into MLS Listing Database
80 Proofread MLS database listing for accuracy - including proper placement in mapping function
81 Add property to company's Active Listings list
82 Provide seller with signed copies of Listing Agreement and MLS Profile Sheet Data Form within 48 hours
83 Take additional photos for upload into MLS and use in flyers. Discuss efficacy of panoramic photography
Marketing The Listing
84 Create print and Internet ads with seller's input
85 Coordinate showings with owners, tenants, and other Realtors®. Return all calls - weekends included
86 Install electronic lock box if authorized by owner. Program with agreed-upon showing time windows
87 Prepare mailing and contact list
88 Generate mail-merge letters to contact list
89 Order “Just Listed” labels & reports
90 Prepare flyers & feedback faxes
91 Review comparable MLS listings regularly to ensure property remains competitive in price, terms, conditions and availability
92 Prepare property marketing brochure for seller's review
93 Arrange for printing or copying of supply of marketing brochures or fliers
94 Place marketing brochures in all company agent mail boxes
95 Upload listing to company and agent Internet site, if applicable
96 Mail Out "Just Listed" notice to all neighborhood residents
97 Advise Network Referral Program of listing
98 Provide marketing data to buyers coming through international relocation networks
99 Provide marketing data to buyers coming from referral network
100 Provide "Special Feature" cards for marketing, if applicable
101 Submit ads to company's participating Internet real estate sites
102 Price changes conveyed promptly to all Internet groups
103 Reprint/supply brochures promptly as needed
104 Loan information reviewed and updated in MLS as required
105 Feedback e-mails/faxes sent to buyers' agents after showings
106 Review weekly Market Study
107 Discuss feedback from showing agents with seller to determine if changes will accelerate the sale
108 Place regular weekly update calls to seller to discuss marketing & pricing
109 Promptly enter price changes in MLS listing database
The Offer and Contract
109 Receive and review all Offer to Purchase contracts submitted by buyers or buyers' agents.
110 Evaluate offer(s) and prepare a "net sheet" on each for the owner for comparison purposes
111 Counsel seller on offers. Explain merits and weakness of each component of each offer
112 Contact buyers' agents to review buyer's qualifications and discuss offer
113 Fax/deliver Seller's Disclosure to buyer's agent or buyer upon request and prior to offer if possible
114 Confirm buyer is pre-qualified by calling Loan Officer
115 Obtain pre-qualification letter on buyer from Loan Officer
116 Negotiate all offers on seller's behalf, setting time limit for loan approval and closing date
117 Prepare and convey any counteroffers, acceptance or amendments to buyer's agent
118 Fax copies of contract and all addendums to closing attorney or title company
119 When Offer to Purchase Contract is accepted and signed by seller, deliver to buyer's agent
120 Record and promptly deposit buyer's earnest money in escrow account.
121 Disseminate "Under-Contract Showing Restrictions" as seller requests
122 Deliver copies of fully signed Offer to Purchase contract to seller
123 Fax/deliver copies of Offer to Purchase contract to Selling Agent
133 Fax copies of Offer to Purchase contract to lender
124 Provide copies of signed Offer to Purchase contract for office file
125 Advise seller in handling additional offers to purchase submitted between contract and closing
126 Change status in MLS to "Sale Pending"
127 Update transaction management program show "Sale Pending"
128 Review buyer's credit report results -- Advise seller of worst and best case scenarios
129 Provide credit report information to seller if property will be seller-financed
130 Assist buyer with obtaining financing, if applicable and follow-up as necessary
131 Coordinate with lender on Discount Points being locked in with dates
132 Deliver unrecorded property information to buyer
133 Order septic system inspection, if applicable
134 Receive and review septic system report and assess any possible impact on sale
135 Deliver copy of septic system inspection report lender & buyer
136 Deliver Well Flow Test Report copies to lender & buyer and property listing file
137 Verify termite inspection ordered
138 Verify mold inspection ordered, if required
Tracking the Loan Process
139 Confirm Verifications Of Deposit & Buyer's Employment Have Been Returned
140 Follow Loan Processing Through To The Underwriter
141 Add lender and other vendors to HomeTrack™ so agents, buyer and seller can track progress of sale
142 Contact lender weekly to ensure processing is on track
143 Relay final approval of buyer's loan application to seller
Home Inspection
144 Coordinate buyer's professional home inspection with seller
145 Review home inspector's report
146 Enter completion into transaction management tracking software program
147 Explain seller's responsibilities with respect to loan limits and interpret any clauses in the contract
148 Ensure seller's compliance with Home Inspection Clause requirements
149 Recommend or assist seller with identifying and negotiating with trustworthy contractors to perform any required repairs
150 Negotiate payment and oversee completion of all required repairs on seller's behalf, if needed
The Appraisal
151 Schedule Appraisal
154 Provide comparable sales used in market pricing to Appraiser
152 Follow-Up On Appraisal
151 Enter completion into transaction management program
153 Assist seller in questioning appraisal report if it seems too low
Closing Preparations and Duties
154 Contract Is Signed By All Parties
155 Coordinate closing process with buyer's agent and lender
156 Update closing forms & files
157 Ensure all parties have all forms and information needed to close the sale
158 Select location where closing will be held
159 Confirm closing date and time and notify all parties
160 Assist in solving any title problems (boundary disputes, easements, etc) or in obtaining Death Certificates
161 Work with buyer's agent in scheduling and conducting buyer's Final Walk-Thru prior to closing
172 Research all tax, HOA, utility and other applicable prorations
162 Request final closing figures from closing agent (attorney or title company)
163 Receive & carefully review closing figures to ensure accuracy of preparation
164 Forward verified closing figures to buyer's agent
165 Request copy of closing documents from closing agent
166 Confirm buyer and buyer's agent have received title insurance commitment
167 Provide "Home Owners Warranty" for availability at closing
168 Reviews all closing documents carefully for errors
169 Forward closing documents to absentee seller as requested
170 Review documents with closing agent (attorney)
171 Provide earnest money deposit check from escrow account to closing agent
173 Coordinate this closing with seller's next purchase and resolve any timing problems
174 Have a "no surprises" closing so that seller receives a net proceeds check at closing
175 Refer sellers to one of the best agents at their destination, if applicable
176 Change MLS status to Sold. Enter sale date, price, selling broker and agent's ID numbers, etc.
177 Close out listing in HomeTrack™
Follow Up After Closing
178 Answer questions about filing claims with Home Owner Warranty company if requested
179 Attempt to clarify and resolve any conflicts about repairs if buyer is not satisfied
180 Respond to any follow-on calls and provide any additional information required from office files.
Courtesy Realtor.org 2008-07-10. Based on a list prepared by Belton Jennings, CEO of the Orlando Regional REALTORS® Association
I will start by reminding you of some of the reasons why you need to use a Real Estate professional in your Real Estate tranactions Surveys show that many homeowners and homebuyers are not aware of the true value a REALTOR® provides during the course of a real estate transaction. The list here is just a baseline since the services may vary within each brokerage and each market. In Atlanta and around the USA, many REALTORS® routinely provide a wide variety of additional services that are as varied as the nature of each transaction. By the same token, some transactions may not require some of these steps to be equally successful. However, most would agree that given the unexpected complications that can arise, it’s far better to know about a step and make an intelligent, informed decision to skip it, than to not know the possibility even existed. The Critical Role of the REALTOR® – 180 Steps Listed here are 180 typical actions, research steps, procedures, processes and review stages in a successful residential real estate transaction that are normally provided by full service real estate brokerages in return for their sales commission. Depending on the transaction, some may take minutes, hours, or even days to complete, while some may not be needed. More importantly, they reflect the level of skill, knowledge and attention to detail required in today’s real estate transaction, underscoring the importance of having help and guidance from someone who fully understands the process – a REALTOR®.
Pre-Listing Activities
1 Make appointment with seller for listing presentation
2 Send seller a written or e-mail confirmation of listing appointment and call to confirm
3 Review pre-appointment questions
4 Research all comparable currently listed properties
5 Research sales activity for past 18 months from MLS and public records databases
6 Research "Average Days on Market" for this property of this type, price range and location
7 Download and review property tax roll information
8 Prepare "Comparable Market Analysis" (CMA) to establish fair market value
9 Obtain copy of subdivision plat/complex lay-out
10 Research property's ownership & deed type
11 Research property's public record information for lot size & dimensions
12 Research and verify legal description
13 Research property's land use coding and deed restrictions
14 Research property's current use and zoning
15 Verify legal names of owner(s) in county's public property records
16 Prepare listing presentation package with above materials and HomeTrack™ information
17 Perform exterior "Curb Appeal Assessment" of subject property
18 Compile and assemble formal file on property
19 Confirm current public schools and explain impact of schools on market value
20 Review listing appointment checklist to ensure all steps and actions have been completed
Listing Appointment Presentation
21 Give seller an overview of current market conditions and projections
22 Review agent's and company's credentials and accomplishments in the market
23 Present company's profile and position or "niche" in the marketplace
24 Present CMA Results To Seller, including Comparables, Solds, Current Listings & Expireds
25 Offer pricing strategy based on professional judgment and interpretation of current market conditions
26 Discuss Goals With Seller To Market Effectively
27 Explain market power and benefits of Multiple Listing Service
28 Explain market power of web marketing, IDX and REALTOR.com
29 Explain the work the brokerage and agent do "behind the scenes" and agent's availability on weekends
30 Explain agent's role in taking calls to screen for qualified buyers and protect seller from curiosity seekers
31 Present and discuss strategic master marketing plan
32 Explain different agency relationships and determine seller's preference
33 Review and explain all clauses in Listing Contract & Addendum and obtain seller's signature
Once Property is Under Listing Agreement
34 Review current title information
35 Measure overall and heated square footage
36 Measure interior room sizes
37 Confirm lot size via owner's copy of certified survey, if available
38 Note any and all unrecorded property lines, agreements, easements
39 Obtain house plans, if applicable and available
40 Review house plans and make copy
41 Order plat map for retention in property's listing file
42 Prepare showing instructions for buyers' agents and agree on showing time window with seller
43 Obtain current mortgage loan(s) information: companies and & loan account numbers
44 Verify current loan information with lender(s)
45 Check assumability of loan(s) and any special requirements
46 Discuss possible buyer financing alternatives and options with seller
47 Review current appraisal if available
48 Identify Home Owner Association manager if applicable
49 Verify Home Owner Association Fees with manager - mandatory or optional and current annual fee
50 Order copy of Homeowner Association bylaws, if applicable
51 Research electricity availability and supplier's name and phone number
52 Calculate average utility usage from last 12 months of bills
53 Research and verify city sewer/septic tank system
54 Water System: Calculate average water fees or rates from last 12 months of bills )
55 Well Water: Confirm well status, depth and output from Well Report
56 Natural Gas: Research/verify availability and supplier's name and phone number
57 Verify security system, current term of service and whether owned or leased
58 Verify if seller has transferable Termite Bond
59 Ascertain need for lead-based paint disclosure
60 Prepare detailed list of property amenities and assess market impact
61 Prepare detailed list of property's "Inclusions & Conveyances with Sale"
62 Compile list of completed repairs and maintenance items
63 Send "Vacancy Checklist" to seller if property is vacant
64 Explain benefits of Home Owner Warranty to seller
65 Assist sellers with completion and submission of Home Owner Warranty Application
66 When received, place Home Owner Warranty in property file for conveyance at time of sale
67 Have extra key made for lockbox
68 Verify if property has rental units involved. And if so:
69 * Make copies of all leases for retention in listing file
70 * Verify all rents & deposits
71 * Inform tenants of listing and discuss how showings will be handled
72 Arrange for installation of yard sign
73 Assist seller with completion of Seller's Disclosure form
74 "New Listing Checklist" Completed
75 Review results of Curb Appeal Assessment with seller and provide suggestions to improve salability
76 Review results of Interior Décor Assessment and suggest changes to shorten time on market
77 Load listing into transaction management software program
Entering Property in Multiple Listing Service Database
78 Prepare MLS Profile Sheet -- Agents is responsible for "quality control" and accuracy of listing data
79 Enter property data from Profile Sheet into MLS Listing Database
80 Proofread MLS database listing for accuracy - including proper placement in mapping function
81 Add property to company's Active Listings list
82 Provide seller with signed copies of Listing Agreement and MLS Profile Sheet Data Form within 48 hours
83 Take additional photos for upload into MLS and use in flyers. Discuss efficacy of panoramic photography
Marketing The Listing
84 Create print and Internet ads with seller's input
85 Coordinate showings with owners, tenants, and other Realtors®. Return all calls - weekends included
86 Install electronic lock box if authorized by owner. Program with agreed-upon showing time windows
87 Prepare mailing and contact list
88 Generate mail-merge letters to contact list
89 Order “Just Listed” labels & reports
90 Prepare flyers & feedback faxes
91 Review comparable MLS listings regularly to ensure property remains competitive in price, terms, conditions and availability
92 Prepare property marketing brochure for seller's review
93 Arrange for printing or copying of supply of marketing brochures or fliers
94 Place marketing brochures in all company agent mail boxes
95 Upload listing to company and agent Internet site, if applicable
96 Mail Out "Just Listed" notice to all neighborhood residents
97 Advise Network Referral Program of listing
98 Provide marketing data to buyers coming through international relocation networks
99 Provide marketing data to buyers coming from referral network
100 Provide "Special Feature" cards for marketing, if applicable
101 Submit ads to company's participating Internet real estate sites
102 Price changes conveyed promptly to all Internet groups
103 Reprint/supply brochures promptly as needed
104 Loan information reviewed and updated in MLS as required
105 Feedback e-mails/faxes sent to buyers' agents after showings
106 Review weekly Market Study
107 Discuss feedback from showing agents with seller to determine if changes will accelerate the sale
108 Place regular weekly update calls to seller to discuss marketing & pricing
109 Promptly enter price changes in MLS listing database
The Offer and Contract
109 Receive and review all Offer to Purchase contracts submitted by buyers or buyers' agents.
110 Evaluate offer(s) and prepare a "net sheet" on each for the owner for comparison purposes
111 Counsel seller on offers. Explain merits and weakness of each component of each offer
112 Contact buyers' agents to review buyer's qualifications and discuss offer
113 Fax/deliver Seller's Disclosure to buyer's agent or buyer upon request and prior to offer if possible
114 Confirm buyer is pre-qualified by calling Loan Officer
115 Obtain pre-qualification letter on buyer from Loan Officer
116 Negotiate all offers on seller's behalf, setting time limit for loan approval and closing date
117 Prepare and convey any counteroffers, acceptance or amendments to buyer's agent
118 Fax copies of contract and all addendums to closing attorney or title company
119 When Offer to Purchase Contract is accepted and signed by seller, deliver to buyer's agent
120 Record and promptly deposit buyer's earnest money in escrow account.
121 Disseminate "Under-Contract Showing Restrictions" as seller requests
122 Deliver copies of fully signed Offer to Purchase contract to seller
123 Fax/deliver copies of Offer to Purchase contract to Selling Agent
133 Fax copies of Offer to Purchase contract to lender
124 Provide copies of signed Offer to Purchase contract for office file
125 Advise seller in handling additional offers to purchase submitted between contract and closing
126 Change status in MLS to "Sale Pending"
127 Update transaction management program show "Sale Pending"
128 Review buyer's credit report results -- Advise seller of worst and best case scenarios
129 Provide credit report information to seller if property will be seller-financed
130 Assist buyer with obtaining financing, if applicable and follow-up as necessary
131 Coordinate with lender on Discount Points being locked in with dates
132 Deliver unrecorded property information to buyer
133 Order septic system inspection, if applicable
134 Receive and review septic system report and assess any possible impact on sale
135 Deliver copy of septic system inspection report lender & buyer
136 Deliver Well Flow Test Report copies to lender & buyer and property listing file
137 Verify termite inspection ordered
138 Verify mold inspection ordered, if required
Tracking the Loan Process
139 Confirm Verifications Of Deposit & Buyer's Employment Have Been Returned
140 Follow Loan Processing Through To The Underwriter
141 Add lender and other vendors to HomeTrack™ so agents, buyer and seller can track progress of sale
142 Contact lender weekly to ensure processing is on track
143 Relay final approval of buyer's loan application to seller
Home Inspection
144 Coordinate buyer's professional home inspection with seller
145 Review home inspector's report
146 Enter completion into transaction management tracking software program
147 Explain seller's responsibilities with respect to loan limits and interpret any clauses in the contract
148 Ensure seller's compliance with Home Inspection Clause requirements
149 Recommend or assist seller with identifying and negotiating with trustworthy contractors to perform any required repairs
150 Negotiate payment and oversee completion of all required repairs on seller's behalf, if needed
The Appraisal
151 Schedule Appraisal
154 Provide comparable sales used in market pricing to Appraiser
152 Follow-Up On Appraisal
151 Enter completion into transaction management program
153 Assist seller in questioning appraisal report if it seems too low
Closing Preparations and Duties
154 Contract Is Signed By All Parties
155 Coordinate closing process with buyer's agent and lender
156 Update closing forms & files
157 Ensure all parties have all forms and information needed to close the sale
158 Select location where closing will be held
159 Confirm closing date and time and notify all parties
160 Assist in solving any title problems (boundary disputes, easements, etc) or in obtaining Death Certificates
161 Work with buyer's agent in scheduling and conducting buyer's Final Walk-Thru prior to closing
172 Research all tax, HOA, utility and other applicable prorations
162 Request final closing figures from closing agent (attorney or title company)
163 Receive & carefully review closing figures to ensure accuracy of preparation
164 Forward verified closing figures to buyer's agent
165 Request copy of closing documents from closing agent
166 Confirm buyer and buyer's agent have received title insurance commitment
167 Provide "Home Owners Warranty" for availability at closing
168 Reviews all closing documents carefully for errors
169 Forward closing documents to absentee seller as requested
170 Review documents with closing agent (attorney)
171 Provide earnest money deposit check from escrow account to closing agent
173 Coordinate this closing with seller's next purchase and resolve any timing problems
174 Have a "no surprises" closing so that seller receives a net proceeds check at closing
175 Refer sellers to one of the best agents at their destination, if applicable
176 Change MLS status to Sold. Enter sale date, price, selling broker and agent's ID numbers, etc.
177 Close out listing in HomeTrack™
Follow Up After Closing
178 Answer questions about filing claims with Home Owner Warranty company if requested
179 Attempt to clarify and resolve any conflicts about repairs if buyer is not satisfied
180 Respond to any follow-on calls and provide any additional information required from office files.
Courtesy Realtor.org 2008-07-10. Based on a list prepared by Belton Jennings, CEO of the Orlando Regional REALTORS® Association
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