Buyers Contemplating a Short Sale

While looking for a home, there are many things to do in order to position yourself in a favorable light to the Seller or REO bank. Just as important though is knowing what properties and which Seller’s to pursue. I see First Time Home-buyers get taken down the prime rose path and afterwards are disgruntled on the whole buying process. Short Sales, if handled correctly, can be an all around good thing but you’d better know what you’re getting into before you start or inevitably waist months of your time. If you find a short sale home you like, there are questions you need to ask yourself and the listing agent that will save you lost time and inspections fees. 1. Has the short sale been approved by the lender/investor and is the appraisal part of this approval? 2. What is the time frame for the bank to sign a short sale payoff? 3. Is there mortgage insurance on the property (if there is this will negate the short sale)? 4. Is the listing agent an expert with short sales and can prove his experience? If these questions are asked and answered upfront you may then be in the running as a short sale buyer; however, i do highly recommend that you locate an agent that is truly familiar with the short sale process because this is just the beginning of a complicated process.

There are lots of arrangements of branches to short sales but like I said, they can be a good deal.

The Benefits of Owning Rather Than Renting in 2009

I have three daughters who have numerous things in common: they're in their twenty somethings, they've put themselves through higher education, they work full time, they're beginning to start new families, and all three of them are Renters. They've voiced their frustrations about "throwing their money away" by renting and wished there were ways to utilize their hard earned income to benefit themselves and their families for the future. I have advised them to take advantage of this year's beneficial environment for First-time Homebuyers. With the current low mortgage rates, the changes in home prices , and the new Homebuyer Tax Credit, buying instead of renting is one of the smartest decisions Renters in their twenty somethings can make for their future.

First-Time Homebuyers Save in Out-of-Pocket Costs
Let us assume Renters pay on average $1,855 for a 3bed/2 bath home. Now include $20 per month for renters insurance and Renters pay a total of $1,875 per month. In contrast, First-time Homebuyers on average only pay $1,340 per month for their mortgage payment and $290 for their taxes and insurance (PITI) totaling $1,630 per month. Based on data analysis by California Association of Realtors(C.A.R.), First-time Homebuyers save $245 per month by not renting. They save $2,940 annually and a whopping $14,700 in out-of-pocket costs within five years. Just think, you can use those saving to finally pay off those enormous school loans, put it towards your kid's college fund, or start that small business you've always wanted too.

Tax benefits for First-time Buyers
We all know that homeowners can itemize and deduct their mortgage interest and property taxes from their taxable income; however, this year the Stimulus Bill gave a first time Homebuyer Tax Credit of 10% of the purchase price of homes up to $8,000. Though the First-time Buyer Tax Credit is set to end on 11/30/09, legislation is considering a six month extension to continue boosting California's housing market.

These tax benefits substantially increase the advantages of being a First-time Homebuyer this year. For example, consider two households each earning $48,900 (the minimum income needed to buy the statewide average entry-level home cost of $248,000). The household that is a First-time Homebuyer will gain $15,800 in tax deductions in 2009, not including the $8,000 one-time Tax Credit on that home price. The household that's continued to rent (without the Tax Credit) will usually only be eligible for $10,900 (IRS Standard Deduction). According to a C.A.R. report, First-time Homebuyers in 2009 save over five years $11,440 more so than Renters in tax savings.

These benefits are only a few of many reasons why Renters should seriously consider the gains this year has to offer for First-Time Homebuyers. I urge my daughters and all twenty somethings to look at the positives in this economic upheaval and while they still can, take advantage of this unique market environment.


(Although I'm not a Certified Public Accountant I am a real estate consultant; however, any tax questions should be directed to your tax advisor.)

Real Estate 101

Today I have a huge percentage of clients Ive sold too in 1980 and have since sold to their children. By the looks of it, I’m starting to sell their grandchildren homes. These types of relationships have been earned for countless reasons. I have strong local roots and connections and have always given my knowledge freely to clients, friends, and family over the years. My 30 years full time experience extends from creative financing, sweat equity, FHA, VA, Cal Vet to Conventional loans in excess of $10 million. I have been told many times to write a book on my real estate experience and though I’m not writing a book or trying to polish my own apple, I do have a high level of education in real estate including residential, commercial, development, and building. Ive found the majority of my business has not been about commissions but about answering everyday people's questions concerning the ever-changing multi-faceted world of real estate. I have decided to write blogs weekly about real estate information people should know but usually don't. Besides these tips of the trade I would like to help answer any real estate questions you have with no obligation whatsoever. I don’t always have the answer, but I sure do know where or how to get it. Please feel free to contact me and let’s see how I may be able to help you.